Allahabad Bank is a nationalised bank with its head quarters in Kolkata,India. It is the oldest joint Stock bank in India with over 3000 branches spread across india.It was founded in Allahabad in 1865. On 24 April 2014, the bank entered into its 150th year of establishment.

Trade Finance Scheme

The Allahabad bank, trade finance scheme is providing finance for trader involved in the selling of goods and service. Traders who are partnership firms, Proprietary firms, companies, co-operative societies, one person companies which are not prohibited by government or RBI. The business must have valid licenses and registration certificates as required under local laws and from appropriate authorities and must have properly field income tax reports. The Income Tax Return and a statement of financial Results must be certified by a Chartered Accountancy Firm, and these must be deemed acceptable by the sanctioning authority. The business concern should be a profit- making venture, having declared and with a clear plan as to how future profits will be made.

The purpose of loan is to purchase business premises, like godowns, office space, furnitures, lightning etc for the business concern. To acquire business assets and to meet working capital requirements of business.

MARGIN:

Loan can be sanctioned up to a limit of Rs.5crores can be sanctioned under the scheme.

20% on stocks

20% cash for letter of credit/ Bank Guarantee.

25% on term loan sanctioned for the purpose of acquisition of equipments, tools etc.

30% on receivable (up to 90 days)

50% on term loans that are sanctioned for the purpose of acquiring or constructing business premises.

SECURITY AND GUARANTEE

In additional to the collateral security, personal guarantee of the promoters

Collateral security in the form of NSC’s, LIC that is surrender value or any other tangible securities with a realizable value equal to at least 75% of the total exposure for existing units. Collateral security for the new units in the form of NSC’s, LIC policies.

The personal guarantee of all the partners, in the case of a partnership firm. Personal guarantee of the promoter directors, in the case of a Private Limited company.

Personal guarantee of at least one promoter director, and directors having a major financial stake in the business, in the case of a public limited company.

REPAYMENT

In case of term loan, maximum 84 months inclusive of moratorium is provided. In case of clean term loan maximum tenure of 3 years dependant on cash flows is provided. All working capital facilities must be renewed each year and is subject to assessment every year.