Maharashtra State Financial Corporation

MSFC is a statutory Corporation set up under the State Financial Corporations (SFCs) Act, 1951.

JURISDICTION :
State of Maharashtra (since 1962), State of Goa and the union Territory of Daman & Diu
(since 1964).

FUNCTIONS
To provide mainly the term loan assistance to small and medium scale industries for acquiring fixed assets like land, building, plant & machinery. Loans are presently extended for expansion, diversification, technology development, enlarging product mix / product range, quality improvement including ISO 9000 series certifications and also for Take-Over of Term Loan accounts from Banks . otherFinancial Institutions in case of good borrowers of the Corporation.

FEE BASED ACTIVITIES :
Preparation of Project Appraisal / Feasibility Report etc.

ORGANISATIONAL STRUCTURE :
Besides the Head Office at Mumbai (Bombay), MSFC has 7 Regional Offices and 12 Branch Offices in
Maharashtra and Goa.

The Regional Offices are located at Aurangabad, Kolhapur, Nagpur, Nashik, Pune & Thane in Maharashtra and at Panaji in Goa. The Branch Offices are located at Ahmednagar, Akola, Amravati, Beed, Chandraupr, Chiplun, Jalgaon, Latur, Nanded, Sangli, Satara and Solapur.

ELIGIBLE ACTIVITIES
i) Industrial Activities such as manufacturing, assembling, servicing, processing, preservation, transportation,
setting-up industrial estates, etc.
ii) Activities such as Nursing Homes, Hotels, Restaurants, Tourism Related Activities
iii) Medical Practitioners are eligible for loan for acquiring Electro Medical and other equipment for professional
use.
iv) Qualified Professionals in Management, Engineering, Architecture, Accountancy etc desiring to undertake
expansion of their professional practice / consultancy ventures.
v) Other Service Activities declared as eligible under the SFCs Act.

vi) Proposed :
Commercial Complexes, Multiplexes, Marriage Halls, Group Housing / Residential Complex, etc.
The Small Scale Industrial Units should have SSI Registration while Service Enterprises should be registered with
the appropriate authority.

LOAN LIMIT : Rs. 5 Crore.
QUANTUM OF ASSISTANCE :
While deciding upon the quantum of loan, minimum promoters contribution and the prescribed Debt Equity Ratio
(DER) are taken into consideration. Higher margin and / or shorter repayment period may be insisted depending
upon the nature and rate of technological obsolescence and the risk perception for the project.

DEBT EQUITY RATIO (DER)
Permissible DER for the project is upto 2:1 depending upon the loan amount, nature of assets and risk perception but DER upto 1:1 may be insisted upon keeping in mind viability and collateral security. "Equity" includes promoters' contribution, share capital, seed capital, State Govt. subsidy, portion of accruals, deposits / interest free unsecured loanss (Quasi Equity) raised by the promoters etc. "Debt" includes long term loans, deferred payments, etc.

PROCEDURE FOR SANCTION OF LOAN :
The loan application forms are available free of charge which are to be submitted to the concerned Regional Office
duly filled in with required additional particulars. Preliminary clearance for further processing of the proposal is
given after scrutiny of the proposal and interaction with the promoters by the Screening Committee at the Regional Office or at the Head Office depending upon the loan amount. Detailed Technical and Financial Appraisal of the proposal for the loan is submitted to the Appropriate Authority for sanction of the loan.

PROCESSING FEE

Loan upto Rs.10 Lakh	:	0.7% of the amount sanctioned
Loan above Rs. 10Lakh	:	1% of the amount sanctioned subject to the maximum of Rs.1 Lakh

DISBURSEMENT OF LOAN :
Loan amount is disbursed after the promoters have complied with the terms & conditions stipulated in the
Sanction Letter.

Disbursement is made in stages depending upon the fixed assets acquired / created. Promoters have to furnish
necessary documents, valuation reports and Chartered Accountant's Certificate in the prescribed format to prove
the expenditure incurred. Physical verification of the assets acquired / created is carried out before disbursement
of loan.

The disbursement amount is released by keeping the margin stipulated on the value of the specific assets upon
completion of the legal formalities / documentation.

SECURITY :
i. Prime security in the form of fixed assets viz. land, building, plant & machinery financed by the Corporation
ii. Collateral security depending upon the type of project, location, technological obsolescence, risk perception
etc.

INTEREST RATES :
As may be decided by the Board of Directors of the Corporation from time to time. Presently the rate of interest is 13 % with 1.5 % incentive for prompt payment of principal installments and interest on due dates.

REPAYMENT PERIOD
Repayment schedule is fixed on the basis of the debt servicing capacity of the project. Maximum 8 years' repayment period inclusive of the moratorium period up to 2 years from the date of first disbursement is given. For certain schemes shorter repayment period is prescribed. Only interest payment commences during the moratorium period.

For repayment of Principal : Quarterly Installments.
For payment of interest : Monthly installments.

PERFORMANCE HIGHLIGHTS (Till March - 2004)
Term Loans Sanctioned Investment Catalysed No. of Units Assisted Employment Generated Share of SSI Sector (Numberwise)	Rs. 3417 crore Rs. 6672 crore 58549 14.09 Lakh 94 %

HEAD OFFICE
United India Building, 1st Floor, Sir P. M. Road, Fort, Mumbai - 400 001
* Tel. : (022) 22691911 / 12 / 13 / 14 * Fax : (022) 22691915
* E - Mail : msfchead@vsnl.net * Web : www.msfcfinance.com

REGIONAL OFFICES :
* Mumbai - Konkan * Thane, Daman & Diu * Pune * Nashik * Kolhapur * Aurangabad
* Amravati * Nagpur and * Panaji (Goa)