eCircular

Department: SME BUSINESS UNIT

Sl.No.: 157/2022 - 23
Circular No.: NBG/SMEBU-SBI SHAKTI/11/2022
- 23
Date: Fri 6 May 2022

The Chief General Manager,

State Bank of India,

6
Local Head Office,

4
All Circles

1:
SME/E-COM/2022-23/SKA/Cir/ Dated: 30.04.2022

:1
19
Madam/Dear Sir,

24
SME BUSINESS UNIT
9-
PRE APPROVED BUSINESS LOAN (PABL)
-0

A. ROLL OUT OF PABL REVAMPED JOURNEY UNDER PROJECT PRATHAM

24

B. DISCONTINUATION OF PABL-POS AND MERGE WITH PABL

C. CONSOLIDATED INSTRUCTIONS FOR REVAMPED PABL
D. SOP (STANDARD OPERATING PROCEDURE) FOR REVAMPED PABL
20

Please refer to e-Circular No. NBG/SMEBU-POWER CA/10/2021- 22 dated 24.05.2021

0/

wherein consolidated instructions for PABL and PABL-PoS were issued. Target
segment for Pre- Approved Business Loan was Non-Individuals (Sole Proprietor only)
12

having a Current Account with us and maximum loan amount was capped at Rs. 10
lakhs.
The loan offers under PABL are generated through Analytics (AI/ML) model and eligible
10

customers are shown pop-up on Internet Banking channel wherein the customer can
show his interest and can complete the journey in few minutes. Role of Home branch
10

(Where the current account is maintained) is to verify business activity and complete the
documentation through a simplified journey in LLMS.

02. Under revamped PABL, the scope has been enhanced by increasing loan amount
and by including our Individual Current Account customers and Non Individual (Sole
Proprietor) Current account customers where CIF of Promoter is not linked with Entity
CIF in CBS. A summary of changes/enhancements proposed are furnished below:

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Strictly For Internal Circulation Only

 Particular Existing Proposed
Target Sole Proprietor Current 1. All Sole Proprietor Current Account
Segment Account customers where customers will be included
Promoter CIF is linked (Promoter CIF linked or not linked.)
with Entity CIF 2. Individual Current Account
Customers
Max Loan Rs. 10 lakhs Rs. 20 lakhs
Amount

6
Channel on Yono-Business (Web Sole Proprietor: Yono-Business
which loan browser login) (Web browser login) and Yono-

4
offer is Business App

1:
available Individual Current Accounts: RINB
(Retail Internet Banking)

:1
Internet Straight through journey. Sole proprietor Current Accounts
Banking (where Promoter CIF is not

19
Journey available): Customer needs to provide
Promoter related data (Name, DoB,
Mobile No., Address etc.) on Yono-
24
Business to enable real time CIC
consumer report check for eligibility.
9-
Others: Straight through journey
Pricing Single pricing i.e. Customized based on RSM (Risk
-0

EBLR+5% Scoring Model).

Loan Tenure: Fixed 60 months Fixed 36 months
24

CIBIL Score Minimum 650 Minimum 700

A standardized format for business activity verification has been designed which is to be
20

used at time of field visit by Home branch official.

0/

03. A new product was introduced vide e-circular no. NBG/SMEBU-POWER

12

CA/10/2021- 22 dated 24.05.2021 for Sole Proprietor Current Account customers

having an active PoS. Separate leads were given for the segment with a finer pricing
under the product. Post launch of PABL revamp, no separate leads will be given for
10

PoS customers and these customers will be covered under regular PABL only. Hence,
PABL-PoS stands sunset for opening of any new accounts immediately after roll-out of
10

revamped PABL. Existing loan accounts under PABL-PoS will continue on already
sanctioned T&C.

04. Nature of the product under PABL is dropline overdraft wherein interest is to be
recovered as and when debited and the limit/DP is to be reduced automatically in CBS
in such a manner that the limit/DP becomes zero at end of the loan tenure. It has been
observed that many accounts are SMA/NPA despite sufficient channelization of credits

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through Current Accounts. To avoid the recurrence and to strengthen collection, it has
been decided that Standing Instruction will be set up in Current Account at the time of
account opening itself automatically. Standing instruction will be monthly for an amount
equal to reduction in monthly limit/DP.
For recovery of interest amount from Current Account, functionality will be enabled in
the O/D a/c at time of account opening itself, thus ensuring auto recovery of interest
subject to availability of balance in Current Account. Consent for the same has been
made part of Arrangement letter. The customer should be appropriately informed in this
regard.
For legacy accounts, respective branch has to feed Standing Instruction by obtaining

6
necessary consent from the borrower and interest recovery from current account is to

4
be enabled by branches manually in CBS.

1:
:1
05. Pre-approved offers are generated based on customer related data available in CBS
and data captured from customer during digital channel journey, hence it is the

19
responsibility of branch official to verify all the data points related to customer
identification available in LLMS. If any discrepancy is observed, the same to be rectified.
And if a discrepancy is observed in the data fields which are not allowed to edit, the lead
24
is to be rejected in LLMS with appropriate reason and necessary amendments are to be
made in CBS.
9-
-0

06. The Analytics leads are checked for transaction behaviour, CIC check and the
product is being marketed as pre-approved. However, mere acceptance by the
24

customer on digital channel does not entitle him/her for a loan and it is subject to certain
checks by the branch. Hence, a pre-approved loan can be rejected in LLMS wherein a
20

customer has applied on digital channel. Following are the sample reasons for rejection
of a lead in LLMS
0/

 No business activity observed during field visit

 Data (Name, PAN) mismatch and cannot be edited in LLMS.
12

 Current Account/ business related Credit facility with other banks declared and
the customer is not ready to close prior to disbursement.
10

 Customer does not provide required document as per checklist

 Any other negative observation not stated above.
10

07. PABL leads are to be contacted for their other business requirement as well and
accordingly suitable products are to be offered to them. If the customers are interested
in higher loan amount/bank’s other products, the need is to be met proactively. A
provision has been made to capture other business requirement during digital channel

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journey as well if a customer is not interested in PABL. Such captured requirements will
be mapped in CRM automatically.
08. Revised Arrangement letter will be auto-generated in LLMS which is to be
adequately stamped and a copy to be handed over to the borrower

09. Following Annexures are enclosed with this circular. Circles are advised to sensitize
the operating functionaries suitably to ensure that good quality business is booked in
revamped PAB under Project Pratham.

6
Annexure-I Product Features (Modifications)

4
Annexure-II Consolidated Product Features

1:
Annexure-III Standard Operating Procedure for handling PABL
Annexure-IV Field Visit Format

:1
Annexure-V Roles and Responsibilities
Annexure-VI Revised Application and Arrangement Letter

19
Yours faithfully,
24
9-
-0

(B. Sankar)
24

Chief General Manager (SME & SCF)

20

Encl: As above
0/
12
10
10

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 Annexure-I
Product Features (Modifications)
Parameter Existing Proposed
Target Group C/A customers (Non-Individual C/A Customers with constitution type as
Sole Proprietorship) classified Individual, Sole Proprietors and classified as
as “Micro” as per revised Micro/Small as per definition of MSME. In

6
definition of MSME. case of Individuals C/As, mode of operation

4
should be single.

1:
Eligibility Leads generated by Analytics Leads generated by Analytics based on AI/ML
based on AI/ML rule engine rule engine for existing Current Account

:1
developed for existing Current customers.
Account customers (PABL)

19
Leads generated by Analytics
Department based on AI/ML rule
engine developed for PoS
24
9-
customers. (PABL-PoS)
-0

CIC report Experian Commercial Scrub: Commercial report exclusions:

24

 No active business loan in

CIC report.  If any active business loan is reported in CIC
20

 Suit filed, wilful default, written report.

off and settled incidences are  Accounts having any record of NPA
removed. incidences in other banks in any trade line in
0/

Consumer: the last 36 months.

 CIBIL score should be >650,  Suit filed, wilful default incidences.
12

4, 5, -1 or No history.  Written off, Settled cases (Other than Credit

 Cases where DPD is more Cards).
10

than 29 days in the last 24

months removed. Consumer report exclusions:
 Accounts having any record of
10

delinquency in other banks in  Score other than No history, 4, 5,-1, >=700

reported by member (CIBIL).
Banks/FIs any trade line in the  Any NPA in active accounts in last 12
last 36 months excluded. months.
 Suit filed, wilful default, written  Suit filed, wilful default incidences.
off and settled incidences are  Written off, Settled cases (Other than Credit
removed. Cards).
 If any active business loan is reported in

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  No active business loan in CIC report.
CIC report.
Existing Existing Business Loan on us/off Existing Business Loan on us/off us, if
Business us, if reported, are to be excluded reported, excluded for PABL eligibility.
Loan on However, cases where a customer is having
us/off-us ‘SME Gold loan or Loan against Deposit from
Bank’ will be allowed for PABL.
If there is any business loan (other than SME
Gold loan or Loan against Deposit from Bank)
on same PAN, even if CIF is different, will not
be eligible for PABL.

6
Rate of EBLR+5% p.a., present effective Risk Scoring Model based pricing:

4
Interest rate 11.65% p.a. for PABL
RSM Spread Current

1:
EBLR+3% p.a., present effective Score over RoI
rate 9.65% p.a. for PABL-PoS EBLR

:1
50-60 6.00% 12.65%

19
61-70 5.50% 12.15%
71-80 5.00% 11.65%
24
81-100 4.50% 11.15%
9-
Loan Amount 15% of Trade related Credits in 10% to 20% of Trade related Credits in C/A
C/A arrived at by Analytics. arrived at by Analytics based on the credit
-0

transactions of preceding 12 months in a C/A.

Trade related Credits in C/A will
24

be arrived by Analytics Deptt.

based on the credit transactions RSM Loan Amount
Score (% of Trade related Credits)
of preceding 12 months in a C/A.
20

50-60 10.00%
The amount arrived by Analytics
cannot be modified at operating 61-70 12.50%
0/

level.
71-80 17.50%
12

81-100 20.00%
10

Repayment Fixed 60 Months Fixed 36 months

Tenure
10

Cash No instruction No Business Debit Card/ATM Card/Debit Card

withdrawal in is to be issued to the customer. However, cash
OD account withdrawal using cheque is to be permitted.
Collection All transactions are to be routed It is expected that a borrower use O/D account
through o/d account. as his/her primary account for receiving sale
proceeds but the same may not happen in all
cases. Hence, Interest is to be recovered from

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 C/A as and when debited in O/D A/c in an
automated manner and a Standing Instruction
is to be set up in C/A for an amount equal to
monthly reduction in limit/DP.
NPA As applicable in case of other  Follow-up by Home Branch for SMAs and for
Recovery loan facilities alerts by Analytics Dept through Post
Sanction Monitoring Tool.
 NPA a/cs to be migrated to linked
SMEC/RACC/ RASMEC or to be handled by
Home branch. Migration to happen only
when an a/c needs to be called up.

6
 Legal action by SMEC/Home Branch

4
/RACC/RASMEC as applicable.

1:
For PABL:6501-4018 EB-DOD- 6501-4025 EB-DOD-REVAMPED PABL
PRE APRVD BSNS LON

:1
Product Code
For PABL-PoS: 6501-4021 EB-

19
DOD-PABL-PoS

24
9-
-0
24
20
0/
12
10
10

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 Annexure-II
Revised Consolidated Product Features after proposed changes

Particular Features

Target Group C/A Customers with constitution type as Individual, Sole Proprietors and classified as
Micro/Small as per definition of MSME. In case of Individuals C/As, mode of

6
operation should be single.

4
1:
Purpose of loan To provide hassle free finance to our existing C/A customers for meeting their
multiple requirements related to their business activity.

:1
Eligibility Leads generated by Analytics based on AI/ML rule engine for existing Current

19
Account customers

Banking Sole Banking

Arrangement
24
CIC Scrub Commercial report exclusions:
9-
 If any active business loan is reported in CIC report.
-0

 Accounts having any record of NPA incidences in other banks in any trade line in
the last 36 months.
24

 Suit filed, wilful default incidences.

 Written off, Settled cases (Other than Credit Cards).
20

Consumer report exclusions:

0/

 Score other than No history, 4, 5,-1, >=700 (CIBIL).


12

Any NPA in active accounts in last 12 months.

 Suit filed, wilful default incidences.
 Written off, Settled cases (Other than Credit Cards).
10

 If any active business loan is reported in CIC report.

Type of facility: Dropline Overdraft
10

Quantum of Min.: >Rs.50,000; Max.: Rs. 20 lakhs

Loan

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 It is a digital sanction based on model developed by Analytics. Hence, there would
not be any authority for exercising the discretionary power for sanction at the
operating level. Staff accountability will not be applicable for the sanction as the
Sanctioning same is arrived using Machine learning Model. The limit arrived by Analytics cannot
Authority be changed at operating level. Accountability will be limited to the activities which
are carried out at operating level. No control return is required as there is no
sanction process is to be carried out at operating level.

10% to 20% of Trade related Credits in C/A arrived at by Analytics. Trade related
Credits in C/A will be arrived by Analytics Dept. based on the credit transactions of
preceding 12 months in a C/A. The amount arrived by Analytics cannot be modified

6
at operating level.

4
1:
Loan Amount
Loan amount RSM Score (% of Trade related Credits)

:1
50-60 10.00%
61-70

19
12.50%
71-80 17.50%

Margin (%)
81-100

Not applicable
24 20.00%
9-
Rate of Interest Risk Based Scoring based pricing:
-0

RSM Spread Current

24

Score over RoI

EBLR
20

50-60 6.00% 12.65%

61-70 5.50% 12.15%
0/

71-80 5.00% 11.65%

12

81-100 4.50% 11.15%

10

Repayment Fixed 36 months

Tenure
10

Stock Statement Not Applicable

Periodic Inspection is to be waived for regular accounts, however following actions to

Inspection& be taken by branches based on weekly triggers to be generated in PABL monitoring
Monitoring tool on Analytics Dashboard:

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 Total Score Risk Action by branches
(out of 100) Category
<65 Low No action required

65-85 Medium Soft Follow-up i.e. telephone calls, emails, text

message, sms etc is required
>85 High
An account Critical A close monitoring of these accounts is required to
continuously prevent slippage of the a/c into NPA.
in “high

6
A monthly physical inspection is to be made for
category” for
“Critical Risk Category” Accounts till upgradation of

4
three weeks
these accounts to Low/Medium/High Risk category.

1:
:1
Following action should be taken by branches based on SMA/NPA

19
SMA Category Action by branch
/NPA
SMA-0/SMA-1
24
A visit is to be made to the unit (or) letter is to be sent to the
borrower for regularization of the account.
9-
SMA-2 Registered letter is to be sent to the borrower for
regularization of the account.
-0

NPA Legal notice is to be sent to the borrower for regularization of

24

the account.
If there is no possibility for upgradation, the accounts are to be
20

migrated to linked CPCs (SMEC/RASEMC/RACC) for calling

up the advance and initiate legal action.
0/

In case, the branch is not linked to any CPCs, the above

12

process is to be handled by that branch only where the PABL

account is maintained.
10

A unit is to be inspected monthly for SMA/NPA accounts till regularization or till

migration of the account to SMEC/RACC/RASMEC whichever is earlier.
10

Processing Fee 0.30% of limit + applicable GST

Pre-payment Nil
Penalty

Inspection As per CPPD Card rate

Charges

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Penal Interest As per CPPD card rate

Mode of Dropline Overdraft

Disbursement

Moratorium NA

Collection It is expected that a borrower use O/D account as his/her primary account for
receiving sale proceeds but the same may not happen in all cases. Hence, Interest
is to be recovered from C/A as and when debited in O/D A/c in an automated
manner and a Standing Instruction is to be set up in C/A for an amount equal to

6
monthly reduction in limit/DP.

4
On Demand. All sale proceeds to be routed through the Overdraft account and

1:
monthly interest applied in the account and repayment is to be serviced by the cash

:1
Repayment flows routed through the account. Limit will be reduced equally every month in
dropline OD account in such a manner that limit becomes zero at end of tenure of

19
loan.

Primary: Nil,
Security
Collateral: Nil 24
9-
IRAC As per RBI IRAC norms

NPA Recovery  Follow-up by Home Branch for SMAs and for alerts by Analytics Dept.
-0

 NPA a/cs to be migrated to linked SMEC/RACC/ RASMEC or to be taken up by

24

Home branch. Migration to happen only when an a/c needs to be called up.
Maintenance branch code is to be changed at time of migration.
 Legal action by SMEC/Home Branch /RACC/RASMEC as applicable.
20

Insurance Responsibility on borrower. Branch not to be responsible for insurance of business

assets.
0/

Checklist KYCs applicable for Non-Individual Accounts/Individual accounts, color photograph,

12

Pan no, Udyam Registration Certificate. In case of Sole proprietor, KYC is to be

obtained for promoter also.
10

 Application Form, DP note, DP note take Delivery letter, Arrangement letter.

 Branch should obtain Revival Letter on completion of every two years to ensure
10

Documentation against documents getting time barred.

 Overdraft account should be opened only after obtaining evidence of closure of
Current Accounts with other Banks as declared by the borrower in the
Application Form. Genuineness of the evidence submitted is to be ensured.
Delivery Customer Interface: Yono-Business for Sole Proprietor and RINB for Individuals
Channel

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Product Code 6501-4025 EB-DOD-REVAMPED PABL

Scheme Code 09170: Pre –approved Business Loan

Maintenance of Maintenance by Home Branch and once an account turns NPA and needs to be
Account called up, to be migrated to linked SMEC/RASMEC/RACC for calling up and to
initiate necessary legal action. In case, the branch is not linked to any CPCs, the
above process is to be handled by that branch only where the PABL account is
maintained. Maintenance branch code is to be changed at time of migration.

Others Existing Business Loan on us/off- Existing Business Loan on us/off us, if

6
us reported, excluded for PABL eligibility.

4
However, cases where a customer is
having ‘SME Gold loan or Loan against

1:
Deposit from Bank’ will be allowed for

:1
PABL.
If there is any business loan (other than

19
SME Gold loan or Loan against Deposit
from Bank) on same PAN, even if CIF is
different, will not be eligible for PABL.
Cash withdrawal in OD account 24
No debit Card/ATM/ Business Debit Card
are to be issued to the customer. However,
9-
cash withdrawal through cheque will be
permitted.
-0
24
20
0/
12
10
10

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 Annexure-III
Standard Operating Procedure for Home Branch:
Stage 1: Acceptance of Pre-approved loan offer on Yono-Business/RINB
 Leads are generated/refreshed by Analytics Deptt at monthly interval. A branch official/s
should visit Analytics Dashboard to ascertain the eligible leads pertaining to the branch.
Leads will be made available in the same branch where C/A of the customer is parked.

 Branch official should call the identified customer and should explain the features of the

6
loan product. (After verifying the Contact Centre response on Dashboard, if available)

4
 Branch official should guide the customer for completion of journey by the customer on

1:
Yono-Business/RINB.

:1
 (In case, if the customer has already completed the journey on digital channel
without calling by the branch, details of such customer will be available on

19
Analytics Dashboard).
 If a customer is not interested in availing loan, the reason for the same is to be
fed in Analytics Dashboard.
24
 If the customer is not interested in availing loan under PABL, other business
requirements of the customer is to be assessed and suitable products are to be
9-
offered by mapping of the requirement into CRM.
-0

Stage 2: Collection of KYC related documents and verification of business

activity:
24

 Once, digital journey is completed, the branch official/s should login LLMS and should
20

take a print out of Application and Field visit format available in LLMS.

 Branch official should visit the location of business unit and should verify the information
0/

submitted by the customer with originals and should obtain the copy of KYC documents.
12

Bank official who has verified the documents subscribed his signature on the
photograph and copies of KYC along with his name and SS No Branch official should
also verify the business address and should verify the business activity.
10

Stage 3: LLMS journey

10

 Branch should login LLMS. User role of the official should be AP/AS/ RM/CSO in
LLMS.

 Branch should create customer in LLMS. Pre-filled data will be available in LLMS and
wherever changes are allowed and applicable are to be done. If any change is
applicable but not allowed in LLMS, in such cases, lead is to be rejected in LLMS with
the reason and to be advised accordingly to the customer.

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 Once a customer is created, branch to provide details of pre-disbursal visit.
 Branch can mark a lead as reject in LLMS in case of any adverse visit report.

 Branch official to ensure that requisite set of documents (Applicable for the product) is
executed by the customer. Arrangement letter will be auto generated in LLMS. An
evidence for closure of Current Account with other banks, if any, is to be obtained prior
to creation of OD account. Genuineness of the evidence submitted is to be ensured.

 Scan and upload the document in LLMS. Udyam registration number no. also to be
obtained and to be entered in LLMS. Account is to be created in CBS through LLMS

6
including setting up of Standing Instruction and interest recovery mapping to Current

4
Account.

1:
 Branch user to ensure CIF creation for promoter and link it wherever applicable.

:1
19
Activities after creation of Overdraft account

24
 Branch should explain customer about working of Standing Instruction and interest
recovery from Current Account.
9-
 Processing fee is to be recovered immediately.
-0

 Branch official should ensure that transaction rights are enabled for OD account and
24

cheque book etc is issued for the OD account on request from the customer.

 The borrower should be made aware about the features of Dropline Overdraft account
20

and benefits of routing of transactions through dropline overdraft account.

0/

 The account should be monitored and appropriate actions as prescribed should be

taken in case of SMA/NPA.
12

 Branch should ensure to act based on triggers appearing under Post Sanction
10

Monitoring Tool.

 Branch should migrate the loan document to linked SMEC/RASMEC/RACC if an a/c

10

needs to be called up. Maintenance branch code also to be changed in CBS

accordingly.

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 Turnaround Time Chart (TAT)

Activity Turnaround Time for each activity

Pre-approved offer acceptance Maximum 5-10 minutes

by customer on digital channel.

Accepted offer available in LLMS Within 10 minutes

4 6
Confirmation of KYCs, Activity Dependency on Home Branch

1:
verification and document
(1 hour to 1 working Day)
execution etc by Home branch

:1
user

19
Overdraft account creation Within 10 minutes

24
9-
-0
24
20
0/
12
10
10

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 Annexure-IV
Format for Pre-Disbursal Visit:

01 Name of the unit

02. Constitution of the Unit (Individual/Sole

Proprietor)

03. Mode of operation is Single in case of

Individuals and Sole Proprietor

04. Address of the unit

4 6
05. Details of promoter

1:
06. Date of the Visit

:1
07. Name of Person met (Mobile no. and e-mail, if
any)

19
08 Category of Unit (Manufacturer/Trading/Service)

09. Nature of Business Activity

10. Promoters/Business KYCs (applicable for (Yes/No)

24
9-
opening of Non-individual accounts/Individual)
obtained and verified with originals.
-0

11. The related business activity is being carried (Yes/No)

24

out at the place visited

12. Any adverse observation

20

Signature
0/
12

Name
Designation
10

Date
10

Note: If pre-disbursal visit is adverse, the lead to be rejected in LLMS along with reason.

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 Annexure-V
Roles & Responsibilities:

Home  To follow-up with eligible customers for acceptance of Pre-approved offer.

Branch  To carry out pre-disbursal visit, documentation & disbursement as per SOP.
 Branch should obtain Udyam Registration Certificate before disbursement and
record it.
 Post Sanction monitoring and Inspection as specified below:
Periodic Inspection is to be waived for regular accounts, however following
actions to be taken by branches based on weekly triggers to be generated on

6
Analytics Dashboard:

4
Total Score Risk Action by branches
(out of 100) Category

1:
<65 Low No action required

:1
65-85 Soft Follow-up i.e. telephone calls, emails, text
Medium
message, sms etc is required

19
>85 High
An account Critical A close monitoring of these accounts is required to
continuously prevent slippage of the a/c into NPA.
in “high
category” for 24
A monthly physical inspection is to be made for
“Critical Risk Category” Accounts till upgradation of
these accounts to Low/Medium/High Risk category.
three weeks
9-
Following action should be taken by branches based on SMA/NPA
-0

SMA Category Action by branch

/NPA
24

SMA-0/SMA-1 A visit is to be made to the unit (or) letter is to be sent to the

borrower for regularization of the account.
SMA-2 Registered letter is to be sent to the borrower for
20

regularization of the account.

NPA Legal notice is to be sent to the borrower for regularization of
0/

the account.
If there is no possibility for upgradation, the accounts are to be
12

migrated to linked CPCs (SMEC/RASEMC/RACC) for calling

up the advance and initiate legal action.
10

In case, the branch is not linked to any CPCs, the above

process is to be handled by that branch only where the PABL
10

account is maintained.
A unit is to be inspected monthly for SMA/NPA accounts till regularization or till
migration of the account to SMEC/RACC/RASMEC whichever is earlier.
Migration of documents to linked SMEC/RASMEC/RACC in case an account
needs to be called up.
SMEC/ Calling up of the advance and Initiate necessary recovery measures.
RASMEC/
RACC

Page 17 of 29

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 Annexure-VI

LOAN APPLICATION FORM FOR PABL

(To be submitted along with documents as per the check list)
A. For office Use:
Enterprise INB Channel LLMS Ref No Name of the Branch
Name Ref No

4 6
1:
:1
C/A No. CIF No. Eligible loan Loan amount PoS details, if any
amount available accepted by

19
on INB channel customer on
(In Rs.) INB Channel
(In Rs.)
24
9-
B. Business Information:
-0

Name of the
24

Enterprise

Constitution
20

Current
0/

Business
Address State PIN
12

Code
Telephone Mobile No.
10

No. 91
E-mail: GST No.(if available):
10

Business Value of Plant &

Activity machinery/
Equipment
(Rs. In lacs)
Annual turnover
(Rs. In lacs)

Page 18 of 29

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 Category √ Manufacturer/Trader/ Udyam Registration No.:
Service

C. Background Information of Proprietor:

Name DoB Sex Residential Address with Mobile No. and E-mail

Id proof Id proof no. Address Address Social Category If Minority, name

Type proof proof no. (SC/ST/OBC/ of religion

6
Type Minority Community)

4
1:
:1
19
D. Existing C/As with other bank/s
C/A No. Name of Bank Branch name

24
9-
-0

E. Request for loan

24

Purpose of Loan: …..………………………………………………………………….

With reference to Pre-approved Loan offer available on Internet Banking which is accepted by
20

me/us/admin user mapped against the C/A no……………………….on…….………., please

grant me/us Dropline overdraft of Rs. ……………….(Rs………………………..……….only) for
a period of ………….. months under Pre-approved Business Loan scheme.
0/

I/We hereby certify and undertake that

12

1. All information furnished above by me/us is true, correct and complete.

2. There is/are no overdue/ statutory due owed by me/us.
10

3. I/We shall furnish all other information that may be required by Bank in
connection with my/our application.
10

4. The information may also be exchanged by you with any agency you may
deem fit.
5. You/ representatives of Reserve Bank of India, Mudra Ltd. or representatives of
any other agency as authorized by you, may at any time inspect verify my / our
assets, books of account etc. in our business premise as given above and you
may take appropriate safeguards/action for recovery of Bank’s dues.

Page 19 of 29

Strictly For Internal Circulation Only

6. The overdraft limit to be provided under Pre-approved Business Loan will be
used only for running business activity for which the loan has been provided
and will not be used for any speculative purpose/ any other purpose.
7. All assets (present and future) related to business will be adequately kept
insured by me/us. The responsibility of insurance of these assets will be of
mine/ours.
8. I/We will not create any charge on the business assets in favour of any bank/FI.
All sales proceeds are to be mandatorily routed through proposed dropline OD
account to be maintained with the Bank.
9. Currently, the unit is not maintaining any Current Account in any other bank/FI
except furnished in the application above and these accounts will be closed by

6
me/us prior to disbursement of loan. A proof of the same will be submitted to

4
the SBI branch by me/us. In case, I fail to do so, Bank reserves its right not to

1:
disburse the loan.
10. I/We will ensure that all sale and purchase of the business are routed through

:1
the proposed dropline overdraft account.
11. The unit has presently not availed any kind of credit facilities from any

19
banks/FIs and shall not avail any such credit limit from any bank / FI except the
Bank till any amount is due and outstanding to the Bank under the Dropline
Overdraft Limit.
24
12. All assets of the unit are free from any encumbrances.
13. I/We provide our consent to the Bank for obtaining GST related data or having
9-
access to GST data by Bank till the tenure of the loan. To access GST data,
I/We provide consent for sharing of our data with third party by the Bank, if
-0

necessary.
14. I/We certify that our unit is micro/small unit as per classification of revised
24

MSME definition, 2020.

15. I/We will not establish any banking relationship in name of my firm/business
20

with any bank/FI after availing Dropline Overdraft account from the Bank
without prior intimation to the Bank.
16. I/We will undertake that all my sales proceeds will be routed through the
0/

proposed Overdraft account to be opened.

17. I/We do understand that though, the Bank has offered me pre-approved loan
12

through digital channel but disbursement of the loan is at Sole Discretion of the
Bank.
10

18. I/We also undertake that all the proceeds of the transaction from the PoS
machines shall be credited to the proposed Dropline Overdraft Account
10

Page 20 of 29

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 Space for Photo

(Signatures of Proprietor/Individual whose photo

is affixed above)

6
Date:_______________ Signature of the applicant (s) :

4
1:
:1
Place: ______________ Name of the Applicant (s) :

19
CHECK LIST:




24
All KYC Documents applicable for Non-Individual/Individual Customers
Recent Photograph not older than 6 months.
Copy of PAN
9-
 Udyam registration Certificate
-0
24
20
0/
12
10
10

Page 21 of 29

Strictly For Internal Circulation Only

 LETTER OF ARRANGEMENT
(To be issued in duplicate)
To
_______________________________
_______________________________

(Borrower’s name & address)

Letter No.: ___________________ Date: ________________

6
Dear Sirs,

4
ADVANCES TO SME SEGMENT

1:
SANCTION OF DROPLINE OVERDRAFT UNDER PABL

:1
This has reference to the acceptance by ____________________________

19
(hereinafter referred as “the Borrower”) of Pre-Approved Business Loan (PABL)
offered by the Bank in the INB Portal of the Bank mapped against the Borrower’s
Current Account no___________________________and the Borrower’s consequent

Dropline Overdraft facility 24

application for dropline overdraft dated _____________ requesting us for sanction of
of
(Rupees_________________________________________only).
Rs___________________/-
9-
-0

We have pleasure in advising sanction of Dropline overdraft Facility for

Rs_____________________/-(Rupees __________________________only) under
24

Pre-Approved Business Loan scheme subject to acceptance / fulfilment of the

following Terms and Conditions by the Borrower:
20

I. Dropline Overdraft Facility: The overdraft facility (“Dropline Overdraft Facility”)

shall comprise of initial overdraft limit of Rs ____________
0/

(Rupees____________________________________) (“Initial Overdraft Limit”)

and reduced dropline limit each month to be determined in the manner stated in
12

clause (ii) hereunder (“Operating Limit”). The Dropline Overdraft Facility shall be
available for the tenure of ___________months commencing from the date of
10

opening of the dropline overdraft account in the name of the Borrower.

II. The Initial Overdraft Limit shall be reduced every month by an amount equivalent
10

to L/T (Rounded-up to Rupees) where ‘L’ is the Initial Overdraft Limit and ‘T’ is
the tenure of the Dropline Overdraft Facility. The period of one month for
reduction of the Initial Overdraft Limit shall be reckoned from the date on which
the Dropline Overdraft Facility account is opened in the name of the Borrower.
The Operating Limit shall comprise of the monthly overdraft limit consequent
upon reduction in the Dropline Overdraft Facility where the reduction is calculated
in the manner stated hereinabove on the expiry of each period of one month from
the date of reduction following the first reduction of Dropline Overdraft Limit.

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 III. The said dropline overdraft facility will be secured by a duly executed DP Note
and DP Note Take Delivery letter.

IV. Rate of Interest: __________above EBR (External Benchmark rate) which is

presently __________% p.a. Present effective rate is __________% p.a. Interest
shall be charged on the debit balances in the dropline overdraft account
computed on daily products and debited to the accounts at monthly rests on the
last working day of every month, in accordance with the accounting practices of
the Bank from time to time. The rate of interest is subject to revision from time to
time and the Borrower shall be deemed to have notice of change in the rate of

6
Interest when the changes are notified/displayed at the branch or published in
any newspaper or in the website of the Bank or made through the statement of

4
account or by debit to the loan account.

1:
V. Accrued but unapplied interest, if any, shall be governed by RBI’s directives on

:1
IRAC norms.

19
VI. Enhanced/Penal rate of interest as applicable /decided by the Bank from time to
time will be charged on the excess drawings / irregularity / breach of the Bank’s
extant instruction/guidelines applicable from time to time including overdrawings
24
on account of interest. Enhanced interest will be compounded monthly. The
Bank shall also be entitled to charge at its discretion, enhanced interest rates on
9-
the account, either on the entire outstandings or on a portion thereof, for any
irregularity / non-observance / non-compliance of the Terms and Conditions of
-0

the overdraft.
24

VII. Processing charges as applicable (presently Rs. __________/-) on the dropline

overdraft limit sanctioned will be charged once only.
20

VIII. Annual inspection charge and account keeping charges will be debited from
Dropline Overdraft account.
0/

IX. Dropline overdraft facility may be covered under any Credit Guarantee scheme at
12

sole discretion of the Bank. In case, Bank decides to cover the facility under any
Credit Guarantee Scheme, applicable charges will be debited to dropline
overdraft account on periodic basis as per the scheme’s guidelines.
10

X. All the assets of the business should always be fully insured by the Borrower
10

against fire, lightning, riots, strikes, floods, cyclones, earthquakes, civil

commotion, and other natural calamities, etc., at the Borrower’s cost for full
market value or Bank’s interest, whichever is higher. The policies should be kept
alive (current) during the currency of the advance. The machinery to be
purchased out of the credit facility, if any, to be insured for the full market value or
original cost of the machinery, whichever is higher. Likewise, all the renewals of
the policies should also be effected /done by the Borrower at all materials.

Page 23 of 29

Strictly For Internal Circulation Only

 XI. “The Bank shall not be liable for any consequence arising from not obtaining
insurance of assets related to the business and for non-renewal of insurance in
any year for failure of the Borrower to renew such insurance policy.

XII. Though the Operating Limit is reduced every month till limit is zero on
the…....…..month, the Borrower shall be obliged to repay all outstanding in the
Dropline Overdraft Facility together with interest, penal / additional interest, cost
charges and other monies due from the Borrower to the Bank under the Dropline
Overdraft Facility on demand by the Bank. A notice issued by the Bank
addressed to the Borrower and dispatched at his recorded address or an e-mail
sent to the recorded e-mail address of the Borrower shall be construed as valid
notice sent by the Bank to the Borrower and the Repayment will be on demand.

4 6
XIII. All sale proceeds to be routed through the dropline overdraft account and

1:
monthly interest applied in the account is to be serviced by the cash flow routed
through the account.

:1
XIV. The Borrower shall ensure that the interest in the Dropline Overdraft Facility

19
account is regularly serviced and shall maintain all outstanding within the
Operating Limit regardless of whether the cash flow from sale proceeds/the
proceeds of the PoS sales are sufficient or not. Bank shall be entitled to debit the

XV.
24
amounts thereof to the current account no……………………..of the borrower.

The borrower agrees that an amount equal to Rs. ……………..will be debited

9-
from Borrower’s Current Account ……………………..and will be credited to
proposed overdraft account every month till currency of the loan.
-0

XVI. The Borrower(s) shall pay all the balances owing and outstanding under or at the
24

foot of the accounts under or in respect of the said facilities on demand inclusive
of interest compounded monthly or quarterly or half-yearly as the case may be
20

upto the date of payment including accrued but unapplied interest together with
all service charges, commitment charges, overdue / enhanced rate of interest,
costs, charges and expenses (including the legal costs between the client and
0/

advocate on full indemnity basis) and all such monies debited or accrued in the
accounts in respect of the said facilities immediately upon demand being made
12

by the Bank or in accordance with the terms stipulated for each of the said
facilities as the case may be.
10

XVII. Utilization of dropline overdraft limit should be strictly for the purpose of running
the business for which the facility has been sanctioned and should not be used
10

for any speculative purpose/any other purpose. Any deviation will be dealt with as
per RBI guidelines and terms of sanction.

XVIII. All C/As maintained with other bank/s should be closed prior to disbursement of
the loan and the proof of the same is to be submitted to the Bank before
disbursement

Page 24 of 29

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 XIX. The Borrower should not enter into any borrowing arrangements either secured
or unsecured with any other bank, Financial Institution, company or person.

XX. The Borrower should not create any charge, lien or encumbrance over the assets
and properties of the Unit / Guarantors in favour of any other bank, Financial
Institution, firm or person.

XXI. Unconditional Cancellability and Recall of the Advance: Notwithstanding anything

to the contrary contained herein under this letter, Bank reserves the right to
cancel the limits without any prior notice and the Outstanding Balance are
recallable on demand at the sole discretion of the Bank including but not limited
to any of the following reasons:

4 6
a. Any amount due under principal or interest remaining unpaid and in arrears for a

1:
period of one month after the due date whether demanded or not;
b. In case the limits/part of the limits are not utilized

:1
c. In case of deterioration in the loan account in any manner whatsoever and/or

19
d. In case of non –compliance of term and conditional of sanction, and/ or
e. The borrower committing any breach or default in the performance or observance
of any of the terms contained herein or in the Borrower(s)’s proposal or any other
documents; 24
f. If any of the representations or the documents furnished by the Borrower(s) in its
9-
application are found to be untrue or false or incorrect;
-0

g. Upon entering into any arrangement or composition with its creditors or

committing any act of insolvency;
24

h. Any execution or other similar process being levied or enforced against the
borrower;
20

i. If the borrower ceases to carry on business or threatens not to carry on business;

j. If any circumstances shall occur which in the opinion of the Bank is prejudicial to
0/

adversely the Borrower(s)'s capacity to repay any amounts under the said
facilities;
12

k. If the Borrower(s) misutilises / diverts the monies or the said assets without the
Bank's prior permission / knowledge;
10

l. For any other reason which the Bank considers appropriate to cancel the facility.
10

XXII. In the event of default in repayment of any monies or in the performance or

breach of any terms or obligations, the Bank and / or the Reserve Bank of India
or any other authorized agency will have an absolute discretion or unqualified
right, power and authority to disclose or publish the name of the Borrower / its
proprietor(s) and other details in such manner as they deem fit.

XXIII. The authorized agencies e.g. CIBIL, etc., may use, process, publish or furnish for
consideration or otherwise the information disclosed and /or data or products
prepared by them to any person, any to other credit granters and that the

Page 25 of 29

Strictly For Internal Circulation Only

 Borrower shall not raise any dispute whatsoever in that behalf in all respects and
to all intents.

XXIV. The Bank’s officials / inspectors are to be permitted in the factory / business
premises as and when required to inspect the stocks / books / equipment.
Where the premises are leased / hired, necessary approvals to the effect from
the Lessor, if any required, are to be obtained. All assistance to be extended to
the Bank’s officials in conducting and completing such inspections smoothly.
Necessary remedial steps also to be taken to rectify any shortcomings, if any,
pointed out by the Bank’s officials. The cost of such inspections shall be borne
by the Borrower.

6
XXV. The Bank will have the right to examine at all times the Unit’s books of account

4
and to have the Unit’s factories / offices / showrooms inspected from time to time

1:
by the officials of the Bank and / or qualified auditors and / or technical experts
and / or management consultants or other persons of the Bank’s choice.

:1
XXVI. The Borrower shall not wind up dissolve, reconstitute or transfer its business

19
without obtaining Bank’s prior approval in writing.

XXVII. The Borrower shall maintain adequate books and records which should correctly

24
reflect their financial position and scope of operations and should submit at
stipulated intervals such statements whenever asked by the Bank. The Borrower
shall produce books of accounts for the inspection of Bank staff as and when
9-
called for.
-0

XXVIII. The Borrower shall keep the Bank informed of the happening of any event likely
to have a substantial effect on their profits or business and the remedial
24

measures taken in this regard.

XXIX. The proprietor / partners / directors should not withdraw the profits earned in the
20

business / capital invested in the business without meeting the repayment

obligation under the credit facility.
0/

XXX. The Bank shall be entitled to adjust, appropriate or set-off or exercise lien of or
12

on all monies, securities, goods, instruments held to the credit or for the benefit of
the Borrower(s) on any account or coming into the control or possession of the
Bank in any of its branches whether for any specified purpose or otherwise, with
10

or without any particular mandate and whether singly or jointly, towards the
discharge and satisfaction of the liability of the Borrower(s).
10

XXXI. The Borrower(s) shall be liable to the Bank notwithstanding any change in the
legal status or constitution of the Borrower(s) whether by way of amalgamation,
merger, takeover, dissolution, winding up, insolvency, nationalisation or
otherwise howsoever either by operation of law or by act of the parties but shall
remain in full force and be valid and enforceable against the Borrower(s)
including the entities who shall come into existence upon such change or

Page 26 of 29

Strictly For Internal Circulation Only

 constitution as if they were the parties to these presents since its inception till full
discharge of all the obligations or payments to the Bank.

XXXII. If the Borrower(s) be more than one individual or entity, each one or any of them
is hereby authorised by the others of them to admit and acknowledge their
liability to the Bank by any payment into the account or by way of writing or in any
manner otherwise and any such acknowledgement of liability or part payment by
any one or more of them shall in addition to his / their personal capacity be
deemed to have been made on behalf of each or any of them for the purposes of
Sections 18 and 19 of the Limitation Act, 1963.

XXXIII. Nothing herein contained shall prejudice any rights or remedies of the Bank in

6
respect of any other present or future security, guarantee, obligation or decree for

4
any indebtedness or liability of the Borrower(s) to the Bank.

1:
XXXIV. The Borrower/s hereby gives free and unambiguous consent for the said facilities

:1
granted or agreed to be granted or continued as stated hereinabove by the Bank
to the Borrower/s being recovered as a public demand/monies in terms of any

19
Legislation relating to recoveries thereof, where such consent is necessary under
such legislation.

XXXV.
24
Any demand or notice to be made or given to the Borrower(s) hereto may be
made or given by Fascimile (Fax), Courier or by leaving the same at or by
registered post acknowledgement in an envelope addressed to the Borrower(s)
9-
at the address mentioned hereinabove and any / every such demand or notice
shall be deemed to have been received as the case may be at which it was left or
-0

at which it would have been delivered in the ordinary course of post at the above
address.
24

XXXVI. The letters and this letter exchanged between the Bank and the Borrower shall
form an integral part of the loan documents and DPN, DPN Delivery Letter.
20

Please call on us any working day to execute the DP Note and the DP Note Take
Delivery letter. The Dropline Overdraft is subject to terms and conditions as
0/

mentioned above and as may be prescribed by the Bank from time to time. The
duplicate copy of this arrangement letter may please be returned to us duly
12

signed for and on behalf of the Borrower in token of acceptance of the terms and
conditions detailed herein. Assuring our best services at all times.
10

Yours faithfully,
10

Branch Manager
We accept

Borrower/s

Page 27 of 29

Strictly For Internal Circulation Only

 Key Fact Statement / Fact Sheet

LOAN……………………………………. (name of the specific loan product)

Name of Borrower:
Loan amount
1
Loan term
2
Interest type
3 (fixed or floating)

6
(a) Interest chargeable (a) ………... %. (EBLR / MCLR / Base

4
(In case of Floating Rate Loans) Rate +……………)
4

1:
(b) Interest chargeable (b) ……...%
(In case of Fixed Rate Loans)

:1
Date of reset of interest
5

19
Mode of communication of changes in
6
interest rates
Fee payable

a On application
24
9-
(Pl individually specify all type of
fee)
-0

b During the term of the loan

(Pl individually specify all type of
24

fee)
c On foreclosure
7
(Pl individually specify all type of
20

fee)
d Fee refundable if loan not
0/

sanctioned/disbursed
e Conversion charges for switching
12

from floating to fixed interest and

vice-versa
f Penalty for delayed payments
10

EMI payable
10

Details of security/collateral obtained

9
Date on which annual outstanding
10
balance statement will be issued

Page 28 of 29

Strictly For Internal Circulation Only

Note: The rates and manner of imposition of interest may change as per terms and
conditions mentioned in the arrangement letter.

We accept

4 6
1:
Borrower/s

:1
Place:

19
Date:

PASSPORT SIZE PHOTOGRAPHS OF BORROWER(S)

24
9-
-0
24
20
0/
12
10
10

Note: Photograph to be self-attested

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