Provide hassle free and timely finance for purchase of FRESH construction equipment’s including
- Backhoe loaders
- Excavators/ Diggers/JCBs
- Transit Mixers
- Wheel loaders
- Cranes (Pick N Carry, Heavy Duty, Tower & Derrick)
- Skid Steers
- Heavy DG Sets and
- All other necessary equipment’s involved in construction, mining etc.
- Individuals, Proprietary concerns, Partnership firms, Companies (Private & Public), Trusts (Private Trusts), Limited Liability Partnership and other non-individual entities.
- Plant Hirers, Contractors and Mine Owners
- Minimum period of existence in case of non-individual entities: 2 years in business (can be waived-off by next higher authority on the merit of the case).
The Quantum of Finance is as under:
Maximum 85% of the Invoice Value with 15% minimum Margin.
However, in case of existing borrowers with good track record and repayment history, the Divisional Credit Committees/ Zonal Credit Committees can consider financing upto 90% of the cost of equipment, thus minimum applicable margin in such cases can be 10% only.
- Minimum age in case of individual borrowers and proprietors of proprietorship concerns at the time of loan availment shall be 18 years and age at the time of maturity of the loan should not exceed 75 years.Younger family members can join as Co-Borrowers and his/her age can be considered for fixing the repayment period.
- As per the provisions of Motor Equipments Act, 1988, where a motor Vehicle is jointly owned by more than one person, the application for registration shall be made by one of them on behalf of all the owners and such applicant shall be deemed to be the owner of the motor Vehicle for the purpose of this act. Accordingly, it shall be ensured that in all such cases, an option be got exercised from the joint borrowers to specify the name of the applicant borrower in whose name they want to get the Vehicle registered.
Hypothecation of Construction Equipment to be purchased
I) For cases up to & Inclusive Rs.10.00 lacs: No collateral security
II) For cases above Rs.10.00 lacs and up to & Inclusive Rs.75 lacs:To be covered under guarantee cover of CGTMSE in accordance with the procedure prescribed therein (CGTMSE guarantee fee to be borne by customer)
3rd Party Guarantee of two persons having individual net-worth equivalent to 150% of the loan amount.
Mortgage of immovable property (IM) having realizable sale value of at least 25% of loan amount along with personal guarantee of the mortgagor in case of third party mortgages.
III) For cases above Rs.75.00 lacs and up to & Inclusive Rs.200.00 lacs:To be covered under guarantee cover of CGTMSE in accordance with the procedure prescribed therein (CGTMSE guarantee fee to be borne by customer)
Mortgage of immovable property (IM) having realizable sale value of at least 35% of loan amount along with personal guarantee of the mortgagor in case of third party mortgages.
IV) For cases above 200.00 Lacs:Mortgage of immovable property (IM) having realizable sale value of at least 40% of the loan amount along with personal guarantee of the mortgagor in case of third party mortgages.
Loans to the tune of Rs 100.00 lacs can be considered without insisting on mortgage of tangible collateral. However, this relaxation shall be extended only in deserving cases upon fulfilling below noted conditions:
- The margin contribution by the borrower is at least 25% of the cost of Equipment, i.e LTV is upto 75%.
- Such loans are collaterally secured by TPG of 02 persons with individual net worth of at least 200% of the loan amount.
0.50% of Loan amount+ Applicable GST
Minimum Rs 2500+GST
Maximum Rs 25000+GST.
Maximum Tenor: 72 months
Moratorium Period: Maximum 02 Months
Repayment Period: To be repaid in a maximum of 70 Equated Monthly Installments (EMIs) post expiry of initial moratorium of 02 months. Interest during the moratorium period to be factored in EMIs.
Prepayment/ Foreclosure shall be allowed without any prepayment charges.
RLLR +1.25% (Floating)
All the proposals shall be rated through the Risk Scorer Application, however, the pricing shall be delinked from the rating grade.
The Equipment/Vehicle will have to be comprehensively insured against all risks by the borrower immediately upon 1st disbursement with assignment in favour of J&K Bank as first loss payee. However:
i. First insurance premium will form a part of cost of Equipment/Vehicle and shall be dealt accordingly. The borrower(s) shall be free to obtain insurance from any insurer of his choice, without coercion and out of his/her/their free will.
ii. Insurance premium from 2nd year onwards has to be borne by the borrower on actual basis as and when due.
iii. Branch shall ensure timely renewal of insurance by the borrower on yearly basis till final adjustment of loan and a copy thereof be obtained and kept on record. In case, borrower fails to keep the Equipment/Vehicle charged to bank insured or fails to furnish a copy of policy/ies to the Bank within the stipulated time frame, the risks arising out of this shall be sole responsibility of the borrower. In such case J&K Bank reserves right to comprehensively insure Equipments charged to bank at the cost and expenses of the borrower and pay premium by debit to the borrower’s account. In case premium is paid out of borrower’s loan account same will form part of borrower’s indebtedness to the bank and shall also have charge on the securities. The insurance premium so debited shall not be factored in installments and recovered immediately.
iv. For settlement of Insurance claims, it is a pre-condition that the Equipment/Vehicle, where ever applicable, is operated by a person holding a valid license/permission to operate the type/ class of Equipment/Vehicle. Thus, an undertaking to be obtained from borrowers that the Equipment/Vehicle will be operated only by qualified persons, holding a valid license/permit to operate the type and class of Equipment/Vehicle, at all times. Non-settlement of insurance claims or any other loss due to non- adherence shall be the sole responsibility of the borrower
a) Each and every Construction Equipment/Vehicle/Machine viz. Excavator, Backhoe Compactor Roller, Mobile Crane, Dozer, Fork Lift Truck etc. which is rubber tyred, (including pneumatic tyred), rubber padded or steel drum wheel mounted and self-propelled is to be invariably REGISTERED with the concerned Transport Authorities.
b) Bank’s charge on the hypothecated Equipment/ Vehicle /Machine should be got recorded with the concerned RTO / ARTO as well as VAHAN Central Register (wherever applicable).
c) In case of Companies, Bank’s charge on the Equipment/ property mortgaged should also be registered with Registrar of Companies.
d) In case of Loans collaterally secured by mortgage of tangible collateral, lien shall be marked in relevant revenue records (where ever applicable), besides, charge shall be registered with CERSAI.
e) In case of construction equipments exempted from registration (if any), charge shall be registered with CERSAI.