Syndicate Bank has released a scheme for financing Hotel/Restaurant entrepreneurs. The purpose of the scheme is to meet the credit requirements for setting up a unit, business of hotels, restaurants and lodges, Fast food centers, motels (Dhaba), bakeries, highway inns, pizza centers (franchises), mess, canteen, catering service, services apartments and more. Besides this, the scheme is also for upgrading, renovating and expanding existing units, which can be done by the purchase of furniture and fixures, machineries, equipments and vehicles. Apart from this, the bank has also given the eligibility criteria without which accessing this opportunity would not be possible. All the units under Micro, Small Enterprises and Medium Enterprises in the services sector, who are having an original investment in
All the units under Micro, Small Enterprises and Medium Enterprises in the services sector, who are having an original investment in equipments not exceeding Rs 5 crore are eligible to participate in this scheme. Besides, individuals, proprietorship, partnership concern, limited companies, trusts, and societies also fall into the eligibility criteria category. Apart from all this, there is a need for having a valid license for the units. Units with a valid license that can conduct hotel business by the municipal and local administration will also be considered. Also, the units which fall in the owner premises leased premises with registered and unregistered unexpired lease covering the repayment method will be considered too.
The credit facility will be given in the form of ‘Term Loans’ and ‘Overdraft.’ A unit can take a maximum loan of Rs 10.00 Crore. The margin up to Rs 100 lakh will be 15% and above Rs 100 lakh will be 20%. The interest rate will be like this:
– Up to Rs 10 lakh – Base Rate+1.00%.
– Above Rs 10.00Lakhs and up to Rs 100.00 lakh –BR+2.00%
– Above Rs 100.00 lakh & up to Rs 1000.00 lakh – BR+2.50%
Term loans of 36 months or above will fall into the category of tenor premium. In tenor premium, 0.25% will be added to all term loans above the specified months.
About the security required, all the eligible loans will be covered under CGMSE scheme. There will be primary security/mortgage of land and building associated with the business. CGMSE scheme will not include the collateral security. Collateral security includes a mortgage of immovable property for loans.
The bank has given repayment measures which include:
Working Capital: The working capital has to be renewed annually and the interest has to be serviced monthly.
Term Loan: For the term loan, the repayment period is 7 years including repayment holiday moratorium period.
There will also be processing charges, which will include 50% of applicable Processing, Documentation and Mortgage charges.