There are different types of bank borrowers. They may be classified as individuals, partnership firms, private limited, public limited companies, large corporate, public sector undertakings, multinational companies etc. The financial and non-financial credit facilities required to the above customers are many. We can divide them in to retail borrowers and corporate borrowers. Retail Borrowers: The…
(This posts elucidates different types of credit facilities extended by the banks) You may be aware that banks lend various types of credit facilities to their customers viz.Demand Loans, consumer loans, home loans, education loans, term lending, working capital finance, export credit, Bank Guarantee, Letter of credit, etc. Bank finance to their customers is not…
There are two basic types of loans granted by lenders namely Secured and Unsecured loans. The secured loans are those loans which are granted by the lenders taking security from the borrower against the loan. The security may be prime security or collateral security.Prime security is an asset acquired by a borrower under a loan…
At present, the Asset Reconstruction companies viz. the Securitization Companies / Reconstruction Companies (SC/RCs) are permitted to convert a portion of debt into shares of the borrower company as a measure of asset reconstruction subject to a condition that their shareholding does not exceed 26% of the post converted equity of the company under reconstruction.…
Commercial Banks extend varieties of credit facilities to individuals like salaried persons, professionals, businessmen by way of personal loan, vehicle loans and consumer loans. Personal loan will be granted for any legitimate purposes like whatsoever (e.g. expenses for domestic or foreign travel, medical treatment of self or a family member, even in medical contingencies, meeting…
MUDRA stands acronym for Micro Units Development & Refinance Agency Ltd. It is an institution of Government of India set up for development and refinancing activities relating to non-corporate micro units. At present MUDRA is set up as a subsidiary of SIDBI, pending statutory enactment by the Government. Traditionally commercial banks and financial institutions in…
The Ministry of Rural Development, Government of India is operating a scheme namely ‘Interest Subvention Scheme under Deendayal Antyodaya Yojana – National Rural Livelihoods Mission (DAY-NRLM)’. The funding for the scheme will be met out of Central Allocation under DAY- NRLM. This scheme is limited to Women Self Help Groups in rural areas only and…
The Ministry of Micro, Small and Medium Enterprises is operating a scheme namely “Credit Linked Capital Subsidy Scheme (CLCSS) for technology upgradation of Micro and Small Enterprises. If you are a MSE (Micro & Small Enterprise) manufacturer and if you want to modernize your equipment/plant/machineries, you may get capital subsidy of up to Rs.15 lakh…
A fixed rate loan is a loan where the interest rate on the loan doesn’t fluctuate during the entire term of loan or part of the total term of loan. This allows the borrower to accurately predict their future payments. In floating rate loan (also called variable rate loan) the rate of interest on the…
The farmers in India have been inherently facing with on-farm risks like famine; flood, extreme weather etc. Though these types of natural risks cannot be totally avoided, there are many new on-field techniques developed in India to minimize the loss. However, the most important strategy to mitigate the risk is agriculture insurance. The insurance company…