T U F s
  TUF STATUS
  RESOLUTIONS
  FINANCIAL NORMS
  STEERING COMMITTEE
  ELIGIBLE MACHINERIES
  ADDRESSES
  GOVERNMENT BODIES
  FINANCIAL BODIES
  

PART - III

FINANCIAL NORMS OF INDUSTRIAL FINANCIAL CORPORATION OF INDIA (IFCI)

( For Jute Industry )

Loans Under The TUFS 
Loans under the TUFS will be provided on the following terms and conditions :

Amount of loan :
No minimum or maximum limit 

Promoters’ contribution :
Minimum of 20% of the project cost.

Debt-equity ratio :
Maximum of 1.5 : 1  

DSCR :
Maximum 1.3 

Rate of interest :
 

a) Rupee loan :
Loans under TUFS shall carry interest at normal applicable rates of the lending institutions prevailing at the time of sanction/execution of loan documents. Ministry of Textiles, Govt. of India will reimburse interest to the extent of 5% p.a. which would be made available to borrowers availing of assistance under TUFS. Interest reimbursement as and when received from the Govt. would be passed on to the Borrower by IFCI.

b) Foreign Currency loan :
As applicable to the normal FCL. However, Ministry of Textiles, Govt. of India, would provide a cover for exchange fluctuations not exceeding 5% p.a.

Period of Interest Reimbursement :
Interest reimbursement of 5% as also cover for exchange fluctuation not exceeding 5% p.a. will be available during the period of loan as specified in the Letter of Intent or as may be specified in the loan document. In case of subsequent extension of the repayment period, reimbursement towards interest/exchange fluctuation will not be available for the extended period.

Upfront Fee :
1% of the loan amount plus tax, payable at the time of execution of loan documents.  

Period of loan :
To be decided on the basis of projected cash flow. However, the repayment period, including the moratorium, shall not exceed 8 years.  

Security :
First charge on the entire fixed assets of the borrowing company with a minimum FACR of 1.5 besides the personal/corporate guarantee of promoters/group and pledge of promoters’ shareholdings, as may be decided on the merits of the case. 

Conversion Option :
Not applicable, except in case of defaults.

Pre-Requisites For Assistance Under TUFS 
(i) Detailed project report :
Jute mills are expected to prepare detailed project report, quantify the physical and financial requirements of the scheme including margin money for additional working capital and also bring out clearly the specific technological improvements in crucial areas of operations with their impact on productivity and profitability.

(ii) Management :
As in part IV of Govt. resolution, dated 24.3..99

(iii) Working Capital Requirement :
 
As in part V of Govt. resolution, dated 24.3.99 

Procedure For Application
The applicant companies may submit the loan application in the prescribed format along with Detailed project report (DPR) to IFCI at its Head Office or any of the Regional Offices. IFCI will process the application/ carry out appraisal for assessing the viability including track record of the promoters  and existence of prudent systems and procedures including corporate governance. 

Timeframe For Sanctions
All efforts will be made to process the application and sanction assistance on merits to deserving concerns within two months from the date of receipt of complete application with full information and DPR.