Though BoM had been financing houses and consumer durables but now this is being streamlined and repackaged. "One of the major changes is the empowerment at the branch level with loan sanctioning power of up to Rs 5 lakh at branch manager's level and up to Rs 10 lakh at the chief manager's level," city deputy general manager Kishore Vaze said.

BoM will be providing housing finance with interest charged on reducing balance, a lower margin requirement of 15 per cent, longer repayment schedules of up to 20 years for housing and it will not be charging pre-appraisal charges. The bank will also not be levying penalty on advance payment and instead will be offering a one per cent discount on timely repayment. Another innovation is acceptance of Government securities, NSCs or othersecurities instead of a mortgage on the house. Interest rates will be linked to PLR.

In the consumer durables loan scheme, the bank has done away with insurance except for vehicles and will be granting up to 90 per cent of the loans. Vehicle loans up to Rs five lakh will be available while the consumer durable loan limit is Rs one lakh. Only second hand vehicles will have a higher margin requirement of 40 per cent.

Vaze launched the scheme in Pune, which is the biggest market for BoM and where the target is to touch the Rs 25 crore mark this year. The Pune region has 136 branches of which 61 are urban branches while 75 branches are in the rural areas. Dispelling doubts about the service capability of the bank Vaze promises a faster response time and across the table sanction. The flexibility introduced would put pressure on the margins but there is no way out, says Vaze.