Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Are you a small business owner looking for funds to grow your business? If yes, then Bank of India’s Star Laghu Udyami Samekat Loan might be just the right fit for you. In this article, we will discuss everything you need to know about this loan scheme, including its features, eligibility criteria, documents required, and the application process. In this post you will know the detail on Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know.
What is the Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Bank of India’s Star Laghu Udyami Samekat Loan is a loan scheme designed specifically for micro and small enterprises (MSEs) in India. The loan is offered to MSEs engaged in manufacturing, trading, or service activities and can be used for various purposes such as setting up a new business, expanding an existing one, or purchasing machinery, equipment, or other fixed assets.
Features of Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
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Here are some key features of the Bank of India Star Laghu Udyami Samekat Loan:
Loan Amount
The loan amount can be up to Rs. 50 lakhs, depending on the borrower’s creditworthiness and the project’s viability.
Interest Rate
The interest rate for the loan is based on the Marginal Cost of Funds Based Lending Rate (MCLR) and is subject to change from time to time. As of March 2023, the MCLR for Bank of India is 6.95%, and the interest rate for the Star Laghu Udyami Samekat Loan is MCLR plus a spread of 1.75%, which comes to a total of 8.70%.
Repayment Period
The loan has a maximum repayment period of 7 years, which includes a maximum moratorium period of 6 months. The borrower can choose to repay the loan in equated monthly installments (EMIs) or a bullet repayment at the end of the tenure.
Security/Collateral
The loan is offered against the primary security of the assets created out of the bank finance and collateral security of the assets created out of the borrower’s own contribution.
Processing Fees
The processing fee for the loan is 1% of the loan amount, subject to a maximum of Rs. 10,000.
Eligibility Criteria of Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Here are the eligibility criteria for the Bank of India Star Laghu Udyami Samekat Loan:
Business Entity
The loan is available to MSEs engaged in manufacturing, trading, or service activities.
Age
The borrower should be at least 21 years old and not more than 65 years old at the time of loan maturity.
Turnover
The borrower’s annual turnover should not exceed Rs. 25 crores in the previous financial year.
Credit Score
The borrower should have a good credit score and a satisfactory repayment history.
Project Viability
The project for which the loan is being taken should be viable and should have the potential to generate sufficient cash flows to repay the loan.
Documents Required for Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Here are the documents required for the Bank of India Star Laghu Udyami Samekat Loan:
Application Form
The borrower needs to fill in the loan application form with all the relevant details.
Business Proof
The borrower needs to provide proof of the business entity, such as the Certificate of Incorporation, Partnership Deed, or Memorandum of Association.
Identity Proof
The borrower needs to provide valid identity proof, such as PAN Card, Aadhaar Card, Voter ID, or Passport.
Address Proof
The borrower needs to provide a valid address proof, such as an Adhar card, Pan card or driving license.
Bank Statements
The borrower needs to provide bank statements for the previous 6 months.
Income Tax Returns
The borrower needs to provide income tax returns for the previous 3 years.
Project Report
The borrower needs to provide a detailed project report that includes the project cost, means of financing, expected cash flows, and repayment schedule.
Other Documents
The borrower may be required to submit any other documents that the bank deems necessary to process the loan application.
How to Apply for Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Here are the steps to apply for a Bank of India Star Laghu Udyami Samekat Loan:
- Visit the nearest Bank of India branch and inquire about the loan scheme.
- Obtain the loan application form and fill it in with all the relevant details.
- Attach all the required documents with the application form.
- Submit the application form along with the documents to the bank.
- The bank will verify the documents and process the loan application.
- Upon approval, the loan amount will be disbursed to the borrower’s bank account.
Benefits of Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Here are some benefits of the Bank of India Star Laghu Udyami Samekat Loan:
- The loan is designed specifically for MSEs, which makes it easier for them to access funds.
- The loan amount can be up to Rs. 50 lakhs, which is sufficient for most small businesses.
- The interest rate is competitive, which makes the loan affordable for MSEs.
- The repayment period is flexible, which allows the borrower to choose the repayment tenure as per their cash flows.
- The loan can be used for various purposes, such as setting up a new business, expanding an existing one, or purchasing machinery, equipment, or other fixed assets.
Conclusion-Bank of India Star Laghu Udyami Samekat Loan: Everything You Need to Know
Bank of India Star Laghu Udyami Samekat Loan is an excellent loan scheme for MSEs looking for funds to grow their business. The loan offers a flexible repayment period, a competitive interest rate, and a high loan amount, making it easier for MSEs to access funds.
However, the borrower needs to meet the eligibility criteria and provide all the necessary documents to avail of the loan. If you are an MSE looking for funds, the Bank of India Star Laghu Udyami Samekat Loan might be just the right fit for you.
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FAQs
Q. Can I prepay my Bank of India Star Laghu Udyami Samekat Loan?
Ans. Yes, you can prepay your loan anytime during the tenure without any prepayment penalty.
Q. Can I apply for a Bank of India Star Laghu Udyami Samekat Loan online?
Ans. No, you need to visit the nearest Bank of India branch to apply for the loan.
Q. Is collateral required for the Bank of India Star Laghu Udyami Samekat Loan?
Ans. Yes, collateral is required for the loan, along with primary security of the assets created out of the bank finance.
Q. What is the maximum repayment period for the Bank of India Star Laghu Udyami Samekat Loan?
Ans. The maximum repayment period for the loan is 7 years, which includes a maximum moratorium period of 6 months.
Q. What is the processing fee for the Bank of India Star Laghu Udyami Samekat Loan?
Ans. The processing fee for the loan is 1% of the loan amount, subject to a maximum of Rs. 10,000.
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