TECHNOLOGY DEVELOPMENT & MODERNISATION FUND SCHEME

1.        Objective:   To encourage existing industrial units in the small scale sector to modernise their production activities and adopt improved and updated technology so as to strengthen their export capabilities.

2.        Elegibility:  The eligibility criteria for assistance under the scheme are as under:

     a)    Small scale industrial units including ancillary units which go in for modernisation/technology upgradation, the outlay on land and building should not exceed 25% of the outlay on modernisation/technology upgradation programme.

            b)    The units should be in operation atleast for a period of 3 years.

            c)    The project (RTDM) should not exceed Rs. 50 lacs

            d)    Units which are not in default to institutions or banks.

            e)    Units satisfying all the above requirements may be considered for assistasnce.

3.        Purpose of Assistance:

          Assistance under the scheme would be available for meeting the expenditure on:

    a)    purchase of capital equipment, need based civil works and acquisition of additional land.

    b)    acquisition of technical know-how, designs, drawings and fashion forecast where relevant to specific product group.

    c)    upgradation of process technology and product with thrust on quality improvement comprable with acceptable domestic and international standards.

    d)    improvement in packaging

    e)    cost of TQM and acquisition of ISO 9000 series certification.

    f)    Need based additional/incremental margin money for working capital.

    g)    Preliminary and pre-operative expenses shall not be covered as a part of the cost of the project.

4.    Debt equity ratio:   

        The debt equity ratio as a whole shall not be more than 2:1.

5.    Promoter's contribution:

        Minimum 20% of the project cost.

6.    Rate of interest

7.    Extent of loan:  Assistance under the scheme w3ill need based 75% of cost of RTDM project subject to satisfying the criteria of eligibility of quantum of loan.

8.    Repayment period:

        Period of repayment will be fixed based on the repaying capacity of the borrowing concern but normally not exceeding 5 years including moratorium upto 1 year.

8    Security: Exclusive charge over assets purchased out of the loan, first/second charge on existing fixed assets and other collateral security equivalent to 100% of loan amount.

 

TECHNOLOGY UPGRADATION FOR TEXTILE INDUSTRIES (TUE)

1.    Objective:   To encourage small scale industrial units in textile industries for taking up technology upgradation and modernisation of their production facilities.

2.    Eligibility:

                    Sole proprietory concerns, partnership concerns, co-operative societies, private and public limited companies engaged in the following activities:

        a)        Cotton ginning and processing.

        b)        Textile industry covering

            i)            Silk Reeling and Twisting

            ii)           Wool scouring and combing

            iii)           Synthetic filament yarn texturiing, crimping and twisting

            iv)           Spinning

             v)           Viscose Filament Yarn (VFY)

            vi)           Weaving, knitting including non-wovens, fabric embroidery and technical textiles.

            vii)           Garment/Made-up manufacturing

           viii)            Processing of fibres, yarns fabrics, garments and make-up.

                        The existing units should be making cash profit atleast during the preceding 3 years. The new units with appropriate eligible technology having entire facilities or existing units with or without expansion for modernisation in one or more activities given above.  The multiple activities can be undertaken by way of forward  or backward integration.

3.    Purpose of loan:  To purchase land, building, plant & machinery as per details above.Funds required for VRS scheme for restructuring or manpower of an existing unit also eligible for funding.

 4.    Extent of loan:    Maximum Rs. 5.00 crores.

5.    Debt Equity Ratio: The debt equity ratio as a whole shall not be more than 1.5:1 and relaxation upto 2:1 in deserving cases.

6.    Promoter's contribution: Minimum 20% of the project cost in general and 17.5% of project in extremely deserving cases.

7.    Rate of interest:

8.    Repayment period: 8 to 10 years including moratorium period of 2 years.Lower repayment in initial years (10% or more) with graded step up in subsequent years osn case to case basis. 

9.    Security: First charge over assets purchased, additional collateral security equivalent to 100% or loan.

    

EQUIPMENT REFINANCE SCHEME (ERS)

1.    Objective:   To  provide quick finance for acquisition of capital goods/equipment (indigenous and import goods).

2.    Eligibility:

          a)        Existing industrial concerns having good past record of performance and sound financial position.

           b)       Have been in operation for atleast 4 years.

            c)       Have earned profit and or declared dividend on equity shares during preceding two financial years.

            d)        not in default to institution/banks in the payment of their dues.

                        The existing units should be making cash profit atleast during the preceding 3 years. The new units with appropriate eligible technology having entire facilities or existing units with or without expansion for modernisation in one or more activities given above.  The multiple activities can be undertaken by way of forward  or backward integration.

3.    Purpose of loan:  For purchase of identified items of ploant and machinery and other equipment including energy saving system, for modernisation/expansion/balancing replacement or for any other purposes for new project.Second hand items willbe outside the purview of the scheme.

 4.    Extent of loan:    Maximum  80% of cost of capital goods/equipments to be acquired subject to ceiling of Rs. 2.00 crores on outstanding loan amount subject to satisfaction of the other criteria of consideration of quantum of loan.

5.    Debt Equity Ratio: The debt equity ratio as a whole shall not be more than 1.5:1 and relaxation upto 2:1 in deserving cases.

6.    Promoter's contribution: Minimum 20% of the project cost in general and 17.5% of project in extremely deserving cases.

7.    Rate of interest:

8.    Repayment period: 8 to 10 years including moratorium period of 2 years.Lower repayment in initial years (10% or more) with graded step up in subsequent years osn case to case basis. 

9.    Security: First charge over assets purchased, additional collateral security equivalent to 100% or loan.

    

WORKING CAPITAL TERM LOAN

1. Objective:    The scheme envisages to provide financial assistance for meeting working capital requirement.
2. Eligibility:    The unit should have availed loan from the Corporation.   The unit should be in operation atleast for the last three years. The unit should be in profit. The repayment of dues to HPFC should be regular.
3. Purpose of Loan:    The financial assistance will be made available to meet part of working capital requirements of existing financed units.
4. Extent of loan:    Working capital term loan will be restricted to a maximum of Rs.100 lacs per unit.
5. Promoters' Contribution: As per prevailing norms of the Corporation.
6. Rate of interest:
7. Repayment Period:    Three and half years with moratorium of six months in quarterly instalments.
8. Security:     Mortgage/hypothecation of assets financed.    Collateral security is to be furnished.  Minimum 150% of working capital term loan in the form of immovable property and or fixed deposits. Minimum 100% in the form of immovable property and/or fixed deposits where the existing security margin on primary security is more than 50% alongwith extension of charge on the existing assets.   Higher security may be insisted upon depending upon risk perception. The security shall have to be provided to the satisfaction of the Corporation.

 

SHORT TERM WORKING CAPITAL SCHEME

1. Objective:    The scheme envisages to meet short term working capital requirement of the unit.
2. Eligibility:    The unit should have availed loan from the Corporation.   The unit should be in operation atleast for the last three years. The unit should be in profit. The repayment of dues to HPFC should be regular.
3. Purpose of loan:    The financial assistance will be made available to meet peak requirements of the working capital loan for the current financial year.
4. Extent of Loan:    Working capital loan ranging from Rs.10.00 lacs to Rs.50.00 lacs can be considered for assistance.
5. Promoters' contribution:    As per prevailing norms of the Corporation.
6. Rate of interest:.
7. Repayment period:     The working capital term loan shall be repayable within 8 to 11 months supported by advance cheques.
8. Security:     The loan of the Corporation will be secured by mortgage/hypothecation of assets financed, collateral security in the form of land, building, fixed deposits etc. to the extent of 125% to 150% of the loan amount is required to be made available to the satisfaction of the Corporation.