SBI Rice Mill Plus Loan

Loan is provided for existing and new rice mill from State Bank of India under the SBI Rice Mill Plus loan scheme. The indian economy is agrarian in nature and major thrust is provided for financing food processing units through schemes like the

FPTUFS scheme. Through this specialized scheme, priority is given for financing of rice mills in India. State Bank of India has been playing a critical role in the overall growth and development of the SME sector. The bank has offers a wide array of products and services for the needs of the SME sector.

Overview

Rice mills having a credit rating of SB-9 (State Bank of India's rating scale) or above are eligible for the Rice Mill plus scheme. Funding provided under this scheme can be used by the business for acquisition of machinery, factory building or for modernisation or expansion of an existing premises. Further, funds can also be used for working capital purposes.

Eligibility Criteria

To be eligible for the Rice Mill plus scheme, the unit must be engaged in the activity of rice milling and profitable. A 15% to 25% margin money requirement is applicable for term loan and a 15% to 40% margin money requirement is applicable for working capital facility. New rice mills are also eligible for financing under this scheme.

Amount of Loan

Loan can be sanctioned as a working capital facility (fund based or non-fund based) or term loan. The amount of loan would depend on the applicant, project cost and need based working capital requirement of the business. There is no upper ceiling on the amount of loan that can be sanctioned under this scheme.

Interest and Repayment

Rice mill plus loan is sanctioned with a floating interest rate, liked to the base rate. The interest rate would be determined based on the size of limit, value of collateral security provided and borrower risk profile. Term loan sanctioned under this scheme typically have a repayment period of between 5 to 7 years excluding moratorium period of 12 months. Working capital facility would have a 12 month period, subject to renewal based on the satisfactory conduct of the account.

Collateral Security

Loan of less than Rs.10 lakhs can be sanctioned under the

CGTMSE scheme without any collateral security. Loan over Rs.10 lakhs must be secured by way of an equitable mortgage of property or tangible security belonging to the borrower or guarantor. In addition to the collateral security, the bank would extend hypothecation or pledge over assets created out of bank's finance. All assets created using bank loan must also be insured to the full value by the business.

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Frequently Asked Questions

Common questions about SBI Rice Mill Plus Loan.

The SBI Rice Mill Plus Loan is a specialized loan scheme offered by the State Bank of India (SBI) to finance existing and new rice mills in India. It provides funding for acquisition of machinery, factory buildings, modernization, expansion, and working capital requirements for rice milling businesses.

Rice mills engaged in the activity of rice milling and having a credit rating of SB-9 (SBI's rating scale) or above are eligible for the Rice Mill Plus scheme. Both new and existing profitable rice mills can apply for this loan.

A margin money requirement of 15% to 25% is applicable for term loans, and 15% to 40% is required for working capital facilities under the SBI Rice Mill Plus Loan scheme.

No, there is no upper ceiling on the amount of loan that can be sanctioned under the SBI Rice Mill Plus Loan scheme. The loan amount depends on the applicant's project cost and the need-based working capital requirement of the business.

The SBI Rice Mill Plus Loan is sanctioned with a floating interest rate linked to the base rate, determined based on the loan size, collateral security, and borrower's risk profile. Term loans typically have a repayment period of 5 to 7 years, excluding a 12-month moratorium period.

Loans below Rs. 10 lakhs can be sanctioned under the CGTMSE scheme without collateral security. For loans above Rs. 10 lakhs, an equitable mortgage of property or tangible security belonging to the borrower or guarantor is required as collateral.

Yes, all assets created using the SBI Rice Mill Plus Loan must be insured to their full value by the borrowing business.

Yes, funds from the SBI Rice Mill Plus Loan can be used for working capital purposes in addition to acquiring machinery, factory buildings, modernization, and expansion.

SBI plays a critical role in the overall growth and development of the SME sector in India by offering a wide array of products and services tailored to the needs of small and medium enterprises, including specialized loan schemes like the Rice Mill Plus Loan.

Yes, the SBI Rice Mill Plus Loan is part of a larger thrust by the Indian government to finance food processing units through schemes like the FPTUFS (Food Processing Turant Upay Samadhan) scheme, recognizing the agrarian nature of the Indian economy.