How it Works

• Pledging Collateral: You offer your existing plant and machinery as security to the lender.
• Loan Sanction: The lender assesses the value of the machinery and offers a loan amount, typically a percentage of its value.
• Funding: Once approved, the funds are disbursed to you for business purposes.
• Repayment: You repay the loan with interest in installments over a predetermined period.

Key Features and Benefits

• Secured Financing: Since the loan is secured by your machinery, you can often get a larger loan amount than with an unsecured loan.
• Boosts Productivity: Access to funds allows you to purchase advanced machinery, which increases production and profitability.
• Preserves Working Capital: You can acquire necessary equipment without using your operating funds, ensuring smooth day-to-day operations.
• Flexible Usage: Funds can be used for purchasing new machinery, acquiring pre-owned equipment, or for repairs and upgrades.
• Longer Repayment Tenure: Lenders often offer extended repayment periods, making the loan more manageable.

Who Can Apply?

• Small and Medium Enterprises (SMEs): This type of loan is a popular financing option for MSMEs looking to grow and upgrade their operational capabilities.
• Manufacturing Businesses: Manufacturers of all sizes can benefit from this loan to enhance efficiency and competitiveness in their sector.