Karur Vysya Bank Business Loan

Karur Vysya Bank Business Loan Highlights
Interest Rate	For KVB Swarnamitra Business Loan: 11.55% p.a. For other KVB Business Loan Schemes: Depending on the credit scores, coverage ratio, internal risk rating (IRR), priority/non-priority sector, etc. of the business entity
Loan Amount	Up to Rs 10 crore
Loan Tenure	Up to 7 years

Note: Interest rates as of 15th April 2024

Karur Vysya Bank Business Loan Interest Rates

The interest rate for the Karur Vysya Bank Business Loan for its Swarnamitra scheme is 11.55% p.a. However, the bank has not disclosed the interest rates for its other business loan schemes. The KVB Business Loan interest rates for its multiple schemes depend on several factors including the credit scores, coverage ratio, internal risk rating (IRR), priority/non-priority sector, etc. of the MSME business entity availing the loan.

Fees and Charges for Karur Vysya Bank Business Loan

Karur Vysya Bank has not disclosed the processing fees and other charges for its business loan schemes. Any MSME business unit planning to avail the KVB business loan can get in touch with the nearby KVB branch to know the exact processing fees and charges provided by the bank. The bank can offer concessions in processing fees and/or upfront charges of up to 25%. The concessions on fees and charges offered for KVB Pharma Plus are mentioned below:

Concession on Karur Vysya Bank Pharma Plus Loan Processing fees

Particulars	Concessions
Processing Charges for OCC / SOD	Fresh Limits – 0.375% Renewal Limits – 0.30%

Concession on other charges for Karur Vysya Bank Pharma Plus Loan

Particulars	Concessions
Insurance Stock	SOD: Limit amount OCC: Maximum of the stock holding in 1 year
Folio Charges for SOD/OCC	Rs 0.50 per entry
Cheque book issue charges	SOD / OCC: Rs 2 per leaf
Current Account holders	For MAB below Rs 1 Lakh: No charges
Outstation cheque collection charges	Up to Rs. 2,000: Rs 20 Rs 2,001 to Rs 10,000: Rs 30 Rs 10,001 to Rs. 20,000: Rs 50 Rs. 20,001 to Rs. 1 Lakh: Rs 75 Above Rs. 1 Lakh: Rs 150

Types of Business Loans provided by Karur Vysya Bank

KVB MSME Easy Loan

Purpose: This business loan product is designed for existing Micro and Small Manufacturing units (other than traders) with minimum existence of 1 year and turnover lower than Rs 1 Crore in the previous financial year. The facilities offered for Manufacturing units include Open Cash Credit (OCC), Letter of Credit (LC), Bank Guarantee (BG), etc. while the facilities for service sector units include SOD-RE and HPL(M).

Interest Rate: The interest rates for KVB MSME Easy Loan is based on factors like the credit score, IRR, coverage ratio, priority/non-priority sector, etc. of the business entity availing the loan.

Loan Amount: The total loan amount for KVB MSME Easy Loan can go up to Rs 50 lakh. The limit for individual facilities under this product are as follows:

• For OCC/SOD-RE/LC: Up to Rs 20 lakh
• For BG: Up to Rs 10 lakh
• For HPL(M): Up to Rs 20 lakh

Loan tenure: The loan tenure for different facilities offered under the KVB MSME Easy Loan are as follows:

• For OCC, LC, SOD or BG: Valid for 1 year and renewable once every year.
• For HPL(M): 3 to 7 years (including the holiday period) depending on the cash flows of the business.

Margin: The Margin for different facilities under KVB MSME Easy Loan are as follows:

• OCC: 25% on stocks and 40% on receivables
• LC/BG: 15% cash margin
• HPL(M): 20% on new machinery and 50% on old machinery (provided the machinery is not older than 3 years) that is to be purchased out of bank finance.
• SOD-RE: 33.33% (against 40% for others) on primary security like building property and residential, commercial or industrial land.

Primary security: The primary security for KVB MSME Easy Loans are as follows:

• For OCC/LC: Stock of raw material, semi-finished & finished goods, stock in process and receivables.
• For HPL(M): The machinery should be purchased out of bank finance.
• For SOD-RE: Minimum cover of 150% of the limit for residential, industrial or commercial land and building property.

Collateral Security:

• For OCC, BG or LC: Residential, industrial or commercial land and building property with minimum 100% of aggregate exposure or Credit Guarantee Trust for Micro & Small Enterprises (CGTMSE) cover.
• For HPL(M): Residential, industrial or commercial land and building property with minimum 100% of aggregate exposure or CGTMSE cover.
• For SOD-RE: All current assets.
• If the immovable properties are not sufficient by themselves to cover the required margin, the bank can accept term deposits, NSCs and/or life insurance policies to cover the difference amount. However, the bank does not accept third-party instruments as collateral security.
• The bank may accept leased industrial property provided that the lease period is at least 30 years (perpetual lease) with mortgage rights present in the lease deed.

Guarantors: Partners, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor or lady proprietor as per the bank’s credit policy provisions.

KVB MSME Term Loan

Purpose: KVB MSME Term Loan offers both short and medium term loans for MSME sector units for acquiring fixed assets related to business, raising long-term funds, improving current ratio, etc. The bank will not consider financing only the factory land for this loan.

Interest Rate: The interest rate is finalised on the basis of the business entity’s credit score/rating.

Loan tenure: 3 to 7 years (depending on the cash flows of the business)

Margin: 40% for building and 20% for machinery.

Primary security: Exclusive charge on all fixed assets and second charge on all current assets of the business unit.

Collateral Security: Equitable Mortgage (EM) charge on immovable assets with a minimum 75% of aggregate exposure. Alternatively, other tangible assets equivalent to a minimum 75% of aggregate exposure.

Guarantors: Partners, proprietors, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor or lady proprietor.

KVB MSME Cash

Purpose: This business loan product from KVB offers working capital (W/C) solutions for MSME businesses in the form of OCC, Secured Overdraft (SOD) or short term loans (W/C) . Businesses can use the STL to procure raw materials, finance expenses related to research and development, obtaining ISO certification, etc.

Interest Rate: KVB decides the interest rates for this business loan product based on the credit score or rating of the business entity applying for the loan.

Loan tenure: The loan tenure for different facilities offered under KVB MSME Cash are as follows:

• For STL: Up to 36 months
• For CC/SOD: 1 year (renewable on yearly basis)

Margin: The Margin for different facilities under KVB MSME Cash are mentioned below:

• OCC: 25% on stocks and 40% on receivables
• STL: 25%
• SOD: Minimum 40% on immovable property (offered as security) with total security coverage of 166.67%

Primary security: The primary security for KVB MSME Easy Loans are as follows:

• For OCC/STL: Hypothecation of all current assets. For calculating drawing power paid stocks and book debts of up to 120 days, excluding the receivables from sister concerns and bills purchased.
• For SOD: Minimum cover of 150% of the total limit for building property and residential, commercial or industrial land.

Collateral Security:

• For OCC/STL: Exclusive charge on all fixed assets of the business unit with at least 75% of aggregate exposure. Alternatively, other tangible assets equivalent with minimum 75% exposure.
• For SOD: Hypothecation of all current assets.

Guarantors: Partners, proprietors, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor or lady proprietor.

KVB Easy Trade Fin

Purpose: This KVB Business Loan scheme offers working capital solutions through the secured overdraft route for individuals, sole proprietors and partnership firms engaged in trading with minimum turnover of Rs 1 crore

Interest Rate: KVB decides the interest rates for this business loan product based on the loan applicant’s credit score/rating.

Loan Amount: Up to Rs 20 lakh

Margin: Rs 1 crore (maximum turnover)

Primary security: The primary security for KVB Easy Trade Fin are as follows:

• Residential or commercial land and building property
• The bank will accept term deposits, National Savings Certificates or Life Insurance Policies in case the immovable properties are not sufficient to cover the required margin. The lender can accept any of these instruments to cover the difference amount in full with the following conditions:
  • The instruments should be in the name(s) of the applicant, proprietor or partner(s) of the applicant firm.
  • Surrender value alone to be considered in case of insurance policies.
  • For National Savings Certificates, the lock-in period (if any) should have been completed and face value of the certificate will be considered for covering the difference amount
  • The principal amount should be taken for fixed deposits and for term deposits, the lender should consider the principal amount plus the accumulated interest as on date of availing the loan.

Collateral Security: Hypothecation of stock-in-trade

Guarantors: Partners & title holders of the property.

Repayment: The secured overdraft shall be for a period of one year, which shall be reassessed and renewed before the expiry of the due date based on the financial or operational performance.

Swarnamitra

Purpose: Swarnamitra business loan is an overdraft/short term loan facility provided to individuals by the bank against their jewellery for business purposes.

Interest Rate: 11.55% p.a.

Loan Amount: Minimum Rs 1 lakh

Loan Tenure: 1 year. The bank can renew the limit for another year subject to their discretion

Primary security: The borrower should pledge gold jewellery with minimum purity of 22 Carats and gold ingots sold by banks.

Collateral Security: Nil

Guarantors: Nil

Other terms and conditions: The other terms and conditions for KVB Swarnamitra Business Loan are as follows:

• The interest to be serviced monthly.
• The drawing power shall be fixed based on the prevailing gold rates at the time of renewal, as notified by the bank.
• The facility shall be availed only by the gold jewellery owners.
• No exchange of Jewellery(ies) are permitted.
• Once the overdraft account becomes irregular/overdue, the provisions applicable to jewel loans (recovery by auction etc.) shall be applicable on this loan as well.

Varthaga Mitra

Purpose: Varthaga Mitra is a secured overdraft loan, short term loan or a combination of both to help traders finance their working capital requirements. This business loan facility is available for individuals, proprietary concerns, partnership firms, hindu undivided family (HUFs), companies, limited liability partnerships (LLP), etc. with business operations of 1 year and above.

Interest Rate: The interest rate for the Varthaga Mitra scheme is decided on the basis of the credit score / rating of the business entity.

Loan Amount: Up to Rs 5 crore

Margin: Security coverage of 167%

Loan Tenure: 1 year. The bank can renew the limit for a further period of 12 months subject to their discretion

Primary security: Residential or commercial land and building property with 50% margin / term deposits / National Savings Certificates / Life Insurance Policies (all or any of them) may also be accepted to cover the difference amount in full provided the following conditions are fulfilled:

• The instruments should be in the name(s) of the applicant or proprietor / partner(s) of the applicant firm.
• The surrender value alone will be considered for insurance policies.
• The lock-in period (if any) for National Savings Certificates should have been completed and the face value of the certificate has to be taken to cover the difference amount.

Collateral Security: Hypothecation of book debts and stock in trade

Repayment: The conditions for repayment in case of Varthaga Mitra business loan are as follows:

• The savings overdraft shall be for 1 year and shall be reassessed and renewed before the expiry of the due date based on the financial / operational performance.
• Short term loans shall be considered for a maximum period of 60 months, repayable in monthly instalments with interest at monthly rests.

KVB Transport Plus

Purpose: This business loan facility enables transport operators to avail term loans for purchasing old/new vehicles (the age of old vehicle must not be more than 5 years) and secured overdraft/working capital demand loan (WCDL) for working capital finance. Individuals, proprietary concerns, partnership firm, limited company, trust, association, etc. including those coming under Priority/Non-Priority sector are eligible for this loan.

Interest Rate: The interest rate is determined based on the credit score/rating of the business loan applicant

Loan Amount: Up to Rs 5 crore

Margin: The Margin for KVB Transport Plus are as follows:

• New vehicle: 15% (for working capital finance the margin is 50%)
• Old vehicle: 50%
• Educational institution: 10%
• There is no per borrower limit for this loan. However, the cap on per borrower limit for working capital finance for new/old vehicles is Rs 50 lakh

Loan Tenure: 1 year. The bank can renew the limit for a further period of 12 months subject to their discretion. However, in case of working capital finance for old/new vehicles, the tenure is 1 year for SOD and 3 years for STL.

Primary security: Hypothecation of the proposed vehicle with body built. For working capital finance, the bank requires the existing vehicle, that is in the borrower’s name and that is free of any debt or other financial liability, as collateral

Collateral Security: The collateral security required for this KVB Business Loan scheme is mentioned below:

• Up to Rs 1 crore loan limit: Nil (cover under CGTMSE).
• Above Rs 1 crore loan limit: EM on land/building or tangible security covering at least 75% of the sanctioned limit.

Collateral Security is optional for borrowers seeking working capital finance against their old/new vehicles

Guarantors: Personal or third party guarantee / family members / partners, directors, trustees, members of association in their individual capacity.

KVB Pharma Plus

Purpose: The KVB Pharma Business Loan scheme is specifically designed for the members of the Chemists and Druggists Association. It provided working capital to chemists and druggists in the form of secured overdraft (against property) or open cash credit facility. Individuals who are members of Chemists and Druggists Association or partnership firms/private limited companies who can submit an introductory letter from the concerned district association are eligible to avail the KVB Pharma Plus Loan

Interest Rate: The interest rate offered for KVB Pharma Loan is on the basis of the credit score/rating of the business entity availing the loan.

Loan Amount: Up to Rs 5 crore

Margin:

• For SOD: Minimum 40% with security coverage of 166.67% of the loan amount
• For OCC: 25%

Primary security: Mortgage of Non-agricultural property (for SOD) and stock & book debts not older than 60 days (for OCC)

Collateral Security: Hypothecation of stock & book debts not older than 60 days (for SOD) and collateral security with minimum coverage of 75% (for OCC)

Guarantors: The guarantors for KVB Pharma Plus are mentioned below:

• For SOD: All partners of a firm
• For OCC: All directors of a private limited company along with personal guarantee of all title holders

KVB Steel Plus

Purpose: KVB Steel Plus helps businesses that trade in iron and steel as well as other non ferrous metals, with minimum 2 years of profitable operations, meet their working capital requirements. The bank provides working capital limits in the form of SOD/OCC and non-fund based limits like bank guarantee (BG), inland letter of credit (ILC) or foreign letter of credit (FLC)

Interest Rate: The interest rate provided for KVB Steel Plus loan is set by the bank based on the credit score/rating of the business loan applicant.

Loan Tenure:

• For SOD/OCC: The bank provides a running account that is renewable once every year.
• For BG, ILC or FLC: The bank provides a running facility renewable once per year. The bank can sanction an LC with tenor of up to 90 days and FLC with tenor not exceeding 120 days. The tenor is based on the operational cycle of a business.

Margin: The Margin for KVB Steel Plus Business Loans are as follows:

• For SOD: 40% on primary security.
• For OCC: 25% on stocks and 35% on book debts (not older than 90 days)
• For BG, ILC or FLC: 15% cash margin.

Primary security:

• For SOD: Equitable mortgage on land/building other than agriculture property (with 166.67% security coverage)
• OCC, BG, ILC or FLC: Mortgage of current assets of the business including stocks and book debts.

Collateral Security:

• For SOD: Mortgage of all current assets (including the borrower’s present/future stock and book debts).
• For OCC, ILC, FLC or BG: Equitable Mortgage on land/building (other than agriculture property). The collateral security coverage should be at least 75%. However, branches should try to get 100% security coverage on the collateral.

Guarantors: Partners (in a partnership firm), directors (of a company) or title holders (of the immovable property offered as security) and husband of lady guarantors, lady proprietor or lady partners.

KVB Textile Plus

Purpose: KVB Textile Plus fulfils the working capital requirements (open cash credit or secured overdraft) of businesses dealing in textile and handloom products, yarn traders, cotton traders and deemed manufacturers (those who purchase cloth and add value in terms of embroidery or printing artwork images) with at least 2 years of profitable operations.

Interest Rate: The interest rate offered for KVB Textile Plus is determined on the basis of the credit score/rating of the loan applicant availing the business loan scheme.

Loan Amount: Rs 15 lakh to Rs 5 crore

Loan Tenure: Karur Vysya Bank provides a running account for this business loan that is renewable every year

Margin: The margin for Karur Vysya Bank Textile Plus business loans are as follows:

• For SOD: 40% on primary security
• For OCC: 25% on stocks and 35% on book debts (not older than 90 days)

Primary security:

• For SOD: Equitable mortgage on land or building other than agriculture property (with security coverage of 166.67%)
• For OCC: Hypothecation of all current assets including book debts and stocks.

Collateral Security:

• For SOD: Mortgage of all current assets (including the borrower’s present/future stock and book debts)
• For OCC: Equitable Mortgage on land/building (other than agriculture property). The collateral security coverage should be at least 75%. However, branches and DOs should try to get 100% security coverage on the collateral.

Guarantors: Partners (in a partnership firm), directors (of a company) or title holders (of the immovable property offered as security) and husband of lady guarantors, lady proprietor or lady partners.

KVB Timber Plus

Purpose: KVB Timber Plus loan is a business loan product that aids the working capital requirements (secured overdraft/open cash credit) of the timber industry.

Interest Rate: KVB sets the interest rate for this business loan scheme based on the credit score/rating of the business entity.

Loan Tenure:

• For fund based options: 1 year (renewable on a yearly basis)
• Fo non-fund based options: Usance period of 180 days for FLC and 120 days for ILC

Margin: The Margin for Karur Vysya Bank Timber Plus business loans are as follows:

• For SOD: Minimum 40% on immovable property offered by the borrower as security (with security coverage of 166.67% and above)
• For OCC: 25% on stocks and 40% on book debts. The lender considers paid stocks and book debts of up to 120 days (excluding receivables from sister concerns) to calculate the borrower’s drawing power
• For non-fund based options: 15% cash margin

Primary security:

• For SOD: EM charge on the timber unit including land, building, other residential or commercial immovable properties (with minimum security coverage of 166.67%)
• For OCC: Hypothecation of all current assets.
• For non-fund based options: Mortgage of stocks procured out of bank finance and other current assets.

Collateral Security:

• For SOD: Mortgaging of all current assets of the business unit
• For OCC: EM charge on timber unit including land, building, other residential or commercial immovable properties (with minimum security coverage of 75%)
• For non-fund based options: EM charge on the timber units comprising land and building, other immovable properties or tangible securities with security coverage of 75%.

Guarantors: Partners, proprietors, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor or lady proprietor.

KVB Construction Plus

Purpose: KVB Construction Plus loan is designed to meet working capital needs of construction and internal material traders with at least 2 years of profitable operations. KVB Construction Plus include both fund based (open cash credit or secured overdraft) and non-fund based limits (bank guarantee, inland letter of credit or foreign letter of credit). The businesses who wish to avail this loan should have a minimum KVB (BB) score of 51.

Interest Rate: The interest rate provided for the KVB Construction Plus scheme is determined based on the business loan applicant’s credit score/rating

Loan Amount: The loan amount for Karur Vysya Bank Construction Plus Business Loan is mentioned below:

• For SOD-RE/OCC: Rs 15 lakh to Rs 10 crore
• For BG/ILC/FLC: Up to Rs 5 crore

The total loan amount of businesses availing both fund based and non-fund based facilities should not exceed Rs 15 crore.

Loan Tenure: The loan tenure for KVB Construction Plus is as follows:

• For SOD-RE/OCC: The lender provides a running account that is renewable every year.
• For BG, ILC or FLC: The bank provides a running facility renewable once every year.
• The ILC with tenor should be up to 90 days and FLC tenor should not exceed 120 days. The tenor of the ILC/FLC sanctioned by the lender is based on the business entity’s operational cycle.

Margin: The Margin for this business loan scheme is as follows:

• For SOD: 40% on primary security
• For OCC: 25% on stocks and 35% on book debts not older than 90 days (as against the the 40% margin for traders as per the bank’s credit policy)
• For BG, ILG or FLC: 15% cash margin

Primary security:

• For SOD: Equitable mortgage on land/building other than agricultural property (with minimum security coverage of 166.67%)
• For OCC, BG, ILC or FLC: Hypothecation of all current assets including stocks and book debts

Collateral Security:

• For SOD-RE: Hypothecation of current assets of the business including stock and book debts (both present and future)
• OCC, BG, ILC or FLC: Equitable mortgage on land/building other than agriculture property. The minimum collateral security cover should be 100% (without any relaxation). However, the branches and DOs should endeavour to get 125% coverage of the collateral security.
• If the immovable properties are not sufficient by themselves to cover the required margin, the bank can accept term deposits, NSCs and/or life insurance policies to cover the difference amount. However, the bank does not accept third-party instruments as collateral security.
• The bank may accept third-party properties as per its credit policy provisions.

Guarantors: Partners, directors or title holders of the immovable property pledged as security for the loan and husband of the lady guarantors, lady proprietor or lady partners as per the bank’s credit policy provisions.

KVB Construction Plus (For Contractors)

Eligibility (for contractors):

• Contractors and sub-contractors undertaking civil, construction, electric, infra, irrigation, pipe laying works for drinking water or drainage, etc., on a contract basis, with more than 2 years of profitable operations are eligible to avail KVB Construction Plus Loan.
• The bank should only consider contractors with good reputation, standing and track records. The minimum rating at the entry level is a KVB (BB) score of 51. The total of fund based working capital limits (the peak level of deficit in cash flow statement) and non-fund based limits should usually not exceed 10 times the total net owned funds (NOF) of the business entity.

Nature of the facility:

• For SOD-RE: The assessment for this business loan is based on the cash budget system. The bank will sanction the limit based on the peak level of cumulative cash deficit based on the projected cash flow statement. The lender will restrict the withdrawals up to the deficit in monthly cash flow statements. KVB may or may not accept the projected cash flow statement based on actual cash flow statements of the earlier years and the borrower’s financial requirement.
• For HPL(M): To purchase new/second-hand machinery.
• For Non-fund based limits: ILC (to purchase raw material or machinery) or BG (Bid Bond guarantees, performance guarantees and/or financial guarantees to help the contractor secure contracts).

Interest Rate: The interest rate is set by the bank based on the credit score/rating of the business loan applicant

Loan Amount: The loan amount for Karur Vysya Bank Construction Plus business loan is mentioned below:

• For SOD-RE: Rs 15 lakh to Rs 5 crore.
• For HPL(M): Up to Rs 5 crore
• For Non-fund based: Maximum of Rs 10 crore. Both the funded and non-funded limits put together should not exceed Rs 20 crore.

Loan Tenure: The loan tenure for KVB Construction Plus (for contractors) is as follows:

• For SOD-RE/OCC: The lender provides a running account that is renewable every year.
• For BG/ILC: The bank provides a running facility renewable once every year.
• The lender can sanction an ILC with tenor of up to 120 days for buying materials and 180 days for purchasing machinery. The tenor is based on the business entity’s operational cycle.
• HPL(M): Maximum 6 years (excluding holiday period & holiday period should not exceed 1 year) depending upon cash flows / DSCR.

Margin: The Margin for this business loan scheme is as follows:

• For SOD: 40% on primary security
• For OCC: 25% on total value of machinery and 50% in case of second-hand machinery
• For BG/ILG: 15% cash margin

Primary security:

• For SOD-RE: Equitable mortgage on land/building other than agricultural property (with 167% security coverage)
• HPL(M): Machinery purchased out of bank finance.
• For BG/ILC: Hypothecation of all current assets including stocks and book debts

Collateral Security:

• For SOD-RE: Hypothecation of current assets of the business including stock and book debts (both present and future)
• For HPL(M)/BG/ILC: Equitable mortgage on land/building other than agriculture property. The minimum collateral security cover should be 100% (without any relaxation). However, the branches and DOs should endeavour to get 125% coverage of the collateral security (excluding the cash margin).
• If the immovable properties are not sufficient by themselves to cover the required margin, the bank can accept term deposits, NSCs and/or life insurance policies to cover the difference amount. However, the bank does not accept third-party instruments as collateral security.
• The bank may accept third-party properties as per its credit policy provisions.

Guarantors: Partners, directors or title holders of the immovable property pledged as security for the loan and husband of the lady guarantors, lady proprietor or lady partners as per the bank’s credit policy provisions.

KVB Rice Plus

Purpose: KVB Rice Plus helps to meet the working capital requirements of rice mills (with more than 3 years of profitable operations) through instruments like working capital demand loan, short term loan, open cash credit or secured overdraft. The bank can provide CC/SOD up to 6 months stock holding level and WCDL/STL up to 2 months stock holding level. The KVB Rice Plus business loan also provides Term Loan (TL) for factory building/plant and machinery for setting up new units, expansion of existing units and investment in plant, machinery or new factory building

Eligibility: All rice millers with greater than 3 years of profitable operations are eligible for  KVB Rice Plus business loans. The bank will consider relaxations for new rice mill units established by promoters of existing profitable units.

Nature of the facility:

• For SOD-RE: The assessment for this business loan is based on the cash budget system. The bank will sanction the limit based on the peak level of cumulative cash deficit based on the projected cash flow statement. The lender will restrict the withdrawals up to the deficit in monthly cash flow statements. KVB may or may not accept the projected cash flow statement based on actual cash flow statements of the earlier years and the borrower’s financial requirement.
• For HPL(M): To purchase new/second-hand machinery.
• For Non-fund based limits: ILC (to purchase raw material or machinery) / BG (Bid Bond guarantees, performance guarantees and/or financial guarantees to help the contractor secure contracts).

Interest Rate: The interest rates for KVB Rice Plus Business Loan is affixed based on credit score or credit rating of its loan applicant.

Loan Amount: The loan amount for Karur Vysya Bank Construction Plus business loan is mentioned below:

• For SOD-RE: Rs 15 lakh to Rs 5 crore.
• For HPL(M): Up to Rs 5 crore
• For Non-fund based: Maximum of Rs 10 crore. Both the funded and non-funded limits put together should not exceed Rs 20 crore.

Loan Tenure: The loan tenure for KVB Construction Plus (for contractors) is as follows:

• For CC/SOD: 1 year
• For STL/WCDL: 3 months. The borrower can avail WCDL / STL more than once in a year depending on the harvest season and the pattern of paddy procurement.
• For Term Loan: Up to 5 years

Margin: The Margin for this business loan scheme is as follows:

• For CC: 25% on stocks and 40% on book debts
• For SOD: 40% on primary security
• For WCDL: 25% on stocks
• For STL: Nil
• 25% for machinery and 40% or more for building.

Primary security:

• For CC/WCDL: First charge on the firm’s existing and future current assets
• For SOD: EM charge on rice mill land, factory building (except for plant & machinery) and other immovable assets provided as security. The bank shall not accept agricultural land as security
• For STL: EM charge on the factory building (excluding Plant & Machinery), rice mill land and other immovable assets given as security. The lender will not accept agricultural land as security. Minimum security coverage should be 100% excluding the security coverage available for CC/SOD limit.
• For Term loans: Hypothecation of plant and machinery acquired out of bank finance.

Collateral Security:

• For CC/WCDL: EM charge on the factory building (apart from plant & machinery), Rice Mill land and other immovable assets given as security. The bank shall require collateral security coverage of at least 75%.
• For SOD/STL: Additional charge both on existing and future current assets of the firm.
• Wherever the rice mill is provided on a lease basis, the bank may accept residential/commercial properties as security
• Term Loan: EM charge on factory building (apart from plant & machinery), Rice Mill land and other immovable assets given as security. The bank shall require collateral security coverage of at least 75%. The bank can accept agricultural property as security subject to the approval by the Central Office of the Bank. The total value of agricultural properties offered as security should not be more than 25% of total securities. If the rice mill is provided on a lease basis, the lease period should cover the term loan repayment period. KVB will not grant term loan (building) on leased premises.

Guarantors: Partners/proprietors of the firm and title holders of the immovable property given as security.

KVB Commodity Plus

Purpose: KVB Commodity Plus helps to meet the working capital requirements of commodity traders, with at least 2 years of profitable operations and KVB (BB) score of 51 and above, through instruments like secured overdraft, open cash credit, packing credit limit (PCL) or foreign bill purchase (FBP) for working capital requirements and inland or foreign letter of credit for the purchasing raw materials. Individuals, sole proprietorship concerns, partnership firms, LLPs, HUFs and companies are eligible to avail this loan.

Nature of the facility:

• Fund based: OCC / SOD-RE / PCL / FBN / FBP
• Non-fund based: ILC / FLC (for purchase / import of raw material).

Interest Rate: The interest rate is based on the prospective business loan applicant’s credit rating or score

Loan Amount: Rs 15 lakh to Rs 10 crore for working capital requirements (both fund based and non-fund based limits put together).

Loan Tenure:

• For OCC / SOD-RE / PCL / FBN / FBP / LC: 1 year.
• For Usance period: 180 days for FLC and 120 days for ILC.

Margin: The Margin for this business loan scheme is as follows:

• OCC: 25% on stocks and 35% on book debts not older than 90 days.
• SOD-RE: 40% on primary security
• ILC / FLC: 15% cash margin
• PCL: 25%
• FBN: Nil
• FBP: 10%

Primary security:

• For OCC, PCL, FBN, FBP, ILC or FLC: Hypothecation of entire current assets.
• For SOD-RE: Equitable mortgage on residential or commercial properties other than agricultural property (with minimum security coverage of 167%).

Collateral Security:

• For SOD-RE: Hypothecation of current assets.
• OCC, PCL, ILC, FLC, FBN or FBP: Equitable mortgage on residential/commercial properties, other than agricultural property, with minimum collateral security coverage of 75%. The bank will not permit any relaxation. If immovable properties are not enough to cover the required margin, the bank may accept term deposits, NSCs, life insurance policies to cover the difference amount. However, third-party instruments are not acceptable.
• Third party properties may be accepted as per credit policy provisions.

Guarantors: Partners, proprietors, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor, lady partner or lady proprietor as per the bank’s credit provisions.

KVB Food and Agro Process Plus

Purpose: KVB Food and Agro Process Plus is a business loan scheme for agro and food processing companies with at least 2 years of profitable operations and KVB (BB) score of 51 and above, both through fund based instruments like secured overdraft, open cash credit, foreign bill purchase and non-fund based instruments like inland/foreign letter or credit for import/purchase of raw materials or machinery and sanction of buyers credit.

Nature of the facility:

• Fund based: OCC / SOD-RE / PCL / FBN / FBP
• Non-fund based: ILC / FLC (for purchase / import of raw material).

Interest Rate: The interest rate is set by the bank based on the credit score/rating of the business loan applicant.

Loan Amount:

• Working capital limits (total of fund and non-fund based limits): Rs 15 lakh to Rs 10 crore
• TL(B) and/or HPL(M): Up to Rs 5 crore
• The maximum exposure of both working capital limits and term loans put together is Rs 15 crores

Loan Tenure:

• OCC, SOD-RE, PCL, FBN, FBP or LC: 1 year.
• HPL(M) / TL(B): Up to 6 years (excluding holiday period & holiday period should not exceed 1 year) depending upon cash flows / DSCR.
• Usance period: 180 days for FLC and 120 days for ILC.

Margin: The Margin for this business loan scheme is as follows:

• OCC: 25% on stocks and 35% on book debts not older than 90 days.
• SOD-RE: 40% on primary security.
• HPL(M): 25% on the value of machinery, in case of second-hand machinery 50%.
• TL(B): 40% on estimated construction cost.
• ILC/FLC: 15% cash margin.
• PC: 25%
• FBP: 10%
• FBN: Nil

Primary security:

• For OCC, PCL, FBN, FBP, ILC or FLC: Mortgage of current assets.
• For SOD-RE: Equitable mortgage on residential or commercial properties other than agricultural property (with minimum security coverage of 167%).
• For HPL(M): Machinery to be purchased out of bank finance
• For TL(B): Land and building to be constructed out of bank finance

Collateral Security:

• For SOD-RE: Hypothecation of entire current assets.
• For OCC, PCL, ILC, FLC, FBN, FBP, HPL(M) or TL(B): Equitable mortgage on residential or commercial properties other than agricultural property with minimum collateral security coverage of 75%. The bank will not permit any relaxation. If the immovable properties are not enough to cover the required margin, the bank may accept term deposits, NSCs, life insurance policies to cover the difference amount. However, third-party instruments are not acceptable.

Guarantors: Partners, proprietors, directors or title holders of the property pledged as security for the loan and husband of the lady guarantor, lady partner or lady proprietor as per the bank’s credit provisions.

KVB POS Plus

Purpose: The KVB POS Plus product is a business loan scheme offering loan against card swipes for merchants using the POS (point of sale) facility depending on the total amount credited to their bank account via POS swipes. Individuals, HUF, Proprietors, Firms, LLP, companies, trusts or societies who are using the POS facility through KVB for minimum 6 months (at least 3 months for new merchants) for business use are eligible to avail this loan. This facility allows individuals to switch between working capital and term loan facility.

Interest Rate: The interest rate is determined based on the business loan applicant’s credit score/rating.

Loan Amount: Rs 5 lakh to Rs 1 crore

Loan Tenure:

• Working Capital: 1 year
• Term Loan: Up to 2 years

Karur Vysya Bank Business Loan Eligibility Criteria

The business loan eligibility criteria set for availing different Karur Vysya Bank Business Loans are as follows:

• For KVB MSME Easy Loan: Minimum existence of 1 year and turnover lower than Rs 1 Crore in the previous financial year.
• For KVB Easy Trade Fin: Minimum turnover of Rs 1 crore
• For Varthaga Mitra: Minimum business operations of 1 year
• For KVB Transport Plus: The age of old vehicle must not be more than 5 years
• For KVB Pharma Plus: Individual members of Chemists and Druggists Association or partnership firms/private limited companies who can submit an introductory letter from the concerned district association
• For KVB Steel Plus: Minimum 2 years of profitable business operations
• For KVB Textile Plus: At least 2 years of profitable business operations
• For KVB Construction Plus: Minimum 2 years of profitable business operations and KVB (BB) score of 51 and above
• For KVB Construction Plus (Contractors): Minimum 2 years of profitable operations and KVB (BB) score of 51 and above. The total of fund based working capital limits (the peak level of deficit in cash flow statement) and non-fund based limits should usually not exceed 10 times the total net owned funds (NOF) of the business entity.
• For KVB Rice Plus: All rice millers with more than 3 years of profitable operations are eligible. The bank will consider relaxations for new rice mill units established by promoters of existing profitable units.
• For KVB Commodity Plus: Minimum 2 years of profitable operations and KVB (BB) score of 51 and above
• For KVB Food and Agro Process Plus: Minimum 2 years of profitable operations and KVB (BB) score of 51 and above
• For KVB POS Plus: Existing merchants using the POS facility through KVB for minimum 6 months (at least 3 months for new merchants)

Although the bank has not provided the eligibility criteria for some of its business loan variants, any MSME business unit planning to avail that particular business loan scheme can get in touch with any nearby KVB branch to know the eligibility criteria for that product.

Documents required for Karur Vysya Bank Business Loan

Karur Vysya Bank has not specified the documents required for its business loan schemes. Apart from the documents required for KYC verification, income proof, proof of residence/business address and proof of business continuity of the MSME business unit, the bank may ask for additional documents from the loan applicants based on the features of the loan scheme.