Scheme of financing harvesting

Financing directly to Custom Service Units managed by individuals, institutions or organizations who maintain a fleet of tractors, Trucks, lorries, Harvesters, Bullock Cart etc. and undertake Harvesting &Transport of Sugarcane for farmers under tie up with Sugar Mills.

Custom Service Units

Individual Custom Service Units with satisfactory CIC report (as applicable to agriculture loans) recommended for finance by Eligible Sugar Mills.
The farm where the Custom Service Units with tractors, Trucks, Lorries, Harvesters are engaged should be within 20 km radius of the Sugar Mill. However farm where the Custom Service Units with Bullock Cart are engaged should be within 5 km radius of the Sugar Mill.
Individuals CSUs should not be defaulter of any Banks/FIs

Sugar Mill

Existing sugar factories having internal rating of Moderate Risk, if eligible to be rated internally as per the norms.
Existing sugar factories having External Rating B and above, if eligible to be rated externally as per norms.
The Sugar Mill's account should not be NPA in the books of any Bank/FIs
The Sugar Mill may have outstanding exposure with any other Banks under tie up arrangement for financing H&T purpose. However the accounts should not be NPA.
There should not be erosion in Net-worth of the Company by more than 50% because of accumulated losses as per latest financial statements.
Sugar Mills which are not having credit facility with us, but having sufficient net worth are also eligible

Business Model	Financing directly to individual Custom Service Units as per the list recommended by such Sugar Mills identified through due-diligence process. For meeting the advance to be paid by the Custom Service Units to the group of labourers engaged and Working capital expenses involved in Transportation/delivery of sugarcane to the sugar factory site.
Quantum of Loan	Maximum of Rs. 10 lakhs per Custom Service Units.
Margin	Margin of 25% to be insisted if the Custom service unit is availing loan for the first time under tie up with Sugar Mill. Lower margin (within the band of 15-25%) may be permitted for Custom Service Units availing the loan for II time/above.
Security	Prime :Receivables from Sugar Factory Collateral: Nil Guarantee: Corporate Guarantee of the Sugar mill covering total indebtedness of CSU finance. Tri-Partite agreement between the Bank/Sugar Mill/CSU to be executed for each loan.
Repayment Period	Principal: Principal shall be liquidated within 12 months from the date of disbursement from receivables of the Mills through direct remittance to respective Borrowers account. Interest: The interest to be debited at half-yearly rest and shall be cleared along with the principal amount.