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Baroda SME Loan Pack

Baroda SME Loan Pack

Baroda SME Loan Pack

Bank of Baroda is the second largest banks in India behind State Bank of India. Having a place amongst the big four banks in India viz. State Bank of India, Bank of Baroda, ICICI Bank and Punjab National bank, Bank of Baroda  has a network of 5326 branches in India and abroad. In this article, we look at the Baroda SME Loan Pack scheme in detail.


The Baroda SME Loan Pack provides a single line of credit to SME businesses to meet their working capital or term loan requirement within an overall limit approved by the bank. Taking into account the nature of business, cash flow and trends, a mix of working capital (fund based and non-fund based facility) and term loan can be sanctioned.


The Baroda SME loan pack can be availed by any MSME business having an annual sales turnover of less than Rs.150 crores. The business must exclusively with Bank of Baroda after disbursement of limit under Baroda SME loan pack. Both new borrowers and existing borrowers of Bank of Baroda, desirous of having sole banking arrangement with the bank would be eligible for the scheme.

Amount of Loan

A maximum loan amount of Rs.5 crores or 4.5 times of borrower’s tangible networth as per last audited Balance sheet, whichever is lower can be sanctioned. A margin of 25% of the limit sanctioned must be maintained by the borrower. Interest rate on the borrowing would be based on the credit rating of the borrower.

Collateral Security

Exclusive charge on the assets of the business must be provided to Bank of Baroda. Further, the personal guarantees of all promoter Directors / Partners would be required. Charge on the unencumbered personal properties of the partners, promoter Directors, wherever applicable can be mandated by the bank.

If a business have MSME registration and classified as a medium business must provide a collateral if the credit line is above Rs.100 lakhs to maintain asset coverage ration above 1.25. In case of micro or small business having MSME registration, loan can be applied for under Credit Guarantee Fund Trust Scheme (CGTMSE) scheme – without collateral. Further, micro and small enterprises having a credit line above Rs.100 lakhs must provide third party guarantee.