1. Long Term Loan Policy
Shashwat Dev
873
BBA-LLB Honours

2. OBJECTIVE
1. To give a brief introduction about the
SARASWAT Cooperative Bank Ltd.
2. To identify the different types of long term
loans policies of SARASWAT Cooperative Bank
Ltd.
3. To analyse and evalute the long term policies of
SARASWAT Cooperative Bank Ltd.

3. INTRODUCTION
• REGISTERED OFFICE : ‘Madhukosh’, S.V.Sovani
Path, Girgaum, Mumbai – 400 004.
• CORPORATE CENTER : Saraswat Bank
Bhavan,Plot No. 953, Appasaheb Marathe Marg,
Prabhadevi, Mumbai – 400 025.
• Website : www.saraswatbank.com
• DATE OF ESTABLISHMENT : September 14, 1918.
• NO. AND DATE OF RBI LICENSE : ACD-MH-
220-P, dated 27.08.1980.
• AUDIT CLASSIFICATION : ‘A’ (Since 1933, i.e.
the year in which we were registered as a Bank)

4. • Saraswat Bank is an urban co-operative banking
institution based in Maharashtra, India and operating
as a co-operative bank since 1918. In 1988, it was
conferred with scheduled status by the Reserve Bank of
India. It has 265 branches nationwide.
• In 1988, it was conferred with scheduled status by
the Reserve Bank of India. It has 265 branches
nationwide.
• The bank has observed good growth during the 2000s
with its total business growing from 40 billion rupees in
2000 to 230 billion rupees in 2010 (approx. 5 billion
US$).

5. • It was registered on 14th september 1918 initially
as a cooperative credit society and later in the
year 1933 was converted into a full fledged
cooperative bank.
• The total business of the bank on 31.03.2013
stood at Rs 36,167.75 crore and net profit after tax
was at 112.09 crore and CRAR was at 11.15.
• The Bank had a zero percent net NPA level which
has been maintained over a period of time.

6. Why Long Term Loan policy?
• Loan underwriting guidelines, and the written
documentation setting forth these standards,
as determined by a bank's senior loan
committee.
• A bank's loan policy also establishes minimum
credit standards in booking new loans, policies
and procedures in treatment of past-due and
delinquent loans, and more generally, the type
of customer a bank wants as a borrower.

7. TYPES OF LOANS
1. Secured Loans: A secured loan is a loan in
which the borrower pledges some asset as a
collateral. Ex: Housing Loans
2. Unsecured Loans: Unsecured loans are loans
that are not secured against the borrower asset.

8. TYPES OF LOANS AT Saraswat Bank
Saraswat Bank has loans for offering to its
customers which are :
• CORPORATE LOANS (BOTH Mid Cos and SMEs)
1. Rental Loans
2. Property Loan
3. Term Loan
4. Corporate Loan
5. Udgyogini Scheme

9. Retail Loans at Saraswat Bank
• Vastu Siddhi Housing Loan
• Super Fast Car Loan
• Super Fast Car loan - High End Car
• Sajawat Loan Scheme
• Saraswati Education Loan
• Education Loan Scheme for disadvantaged groups
• Pravasi- Travel Loan
• Gold Loan Yojana
• Multi Purpose Loan
• Privilege – Executive Finance
• E - Stock Advance
• Property Loan Scheme
• Samruddhi - Loan against Property
• Advance Against RBI Bonds
• Gupt Dhan Yojana-Overdraft against property
• Doctor Delite
• Advantage – for Professional

10. Corporate Loans
• Rental Loan
• Maximum Amount of Loan : Rs. 25.00 lacs
or
65 % of the total net rent (i.e. rent after taxes such as
property tax, TDS) to be received whichever is lower.
Repayment Period : 5 years maximum or till the remaining
period of the lease – which is earlier.
Repayment will be from the rent received.
Security : Equitable mortgage of the property given on rent or
any other acceptable property of value of 35% more than the
loan amount.
Guarantors : In case the borrower is a partnership firm or a
limited company, personal guarantee of the partners/directors .

11. Property Loan
• Firms / companies having net annual taxable income of Rs. 1.50 Lakhs per annum
and in operation for last 3 years making cash profit for last 3 years.
• Limit of Loan
• Minimum - Rs.2 lakhs
• Maximum - Rs. 50 Lakhs
• Basis of Advance
60% of agreement cost (If the property is less than 3 years old.). In other cases, 60%
of value as per valuation report.
Security
Equitable Mortgage of Residential, commercial or industrial property.
Guarantor:
Need not be obtained however in case of firms, companies, guarantee of partners,
directors to be obtained.
Share Holding
2.5% of the loan amount, Maximum 2500 shares, Guarantors as nominal members.

12. Term Loan
• Saraswat Bank provides term finance/term loans
for business expansion, up-gradation of existing
facilities etc to ease the pressures on margins of
the company. The Bank is providing structured
term loans to meet your short term as well as
long term funding requirements . We offer
specific solution so as to match repayment with
your cash flows to repay the debt
thereby enhancing your profitability.

13. Udyogini Scheme
• Saraswat Bank introduces a scheme for women entrepreneurs of
today which takes care of their financial requirements allowing
them to concentrate on their business growth. With lot of
incentives/discount being offered and minimum processing charges
which are enumerated below ,you may contact our nearest branch
and apply:
• Micro Enterprises – Here the finance provided will be upto Rs 2.00
lacs
• Small Scale Enterprises – Here the finance provided will be above Rs
2.00 lacs upto Rs. 50.00 lacs.
• Medium Enterprises – Here the finance provided will be above Rs.
50.00 lacs upto a maximum limit of Rs 100.00 lacs.

14. Discounts given to women in Udyogini
Scheme
Micro Enterprises Micro Enterprises SSI Enterprises Medium
Enterprises
Amount Upto Rs 2.00 lacs Above Rs 2.00 lacs
upto Rs 50.00 lacs
Above Rs 50.00 lacs
upto Rs 100.00 lacs
Margin Nil 10%-15%lower then
the Bank’s norm
10% - 15% lower
then the Banks norm
ROI PLR – 0.5% PLR – 0.5% PLR
Repayment 6 yrs 6 yrs 7 yrs
Security Hypothecation +
Guarantee of
(spouse/ a family
member wherever
required)
Hypothecation + 2
Guarantors +
Collateral Security
(25%)
Hypothecation + 2
Guarantors +
Collateral Security
(30%)
Processing fees Rs. 500/- Rs. 750/- 0.1% of finance limit

15. Retail Loans in Saraswat Bank
Scheme wise Retail Loans Disbursed during FY)
Scheme No. of A/cs
(in Lacs)Disbursed
Amt.
Vastu Siddhi Home
loan 3,240 49,117.64
Super Fast Car 2,727 19,949.99
Samruddhi 705 8,484.18
Multipurpose Loan 2,821 4,044.47
Gold Loan 2,005 3,710.40
Doctor Delite 74 1,271.61
Saraswati Education 315 992.21
Others 418 1,714.66
TOTAL 12,305 89,285.16

16. Retail Loans
• Vastu Siddhi Housing Loan
1. Construction of own house/Purchase of ready
built house/flat/resale flat / takeover of housing
loans from other banks/institutions
2. Salaried Employees /Businessmen/Professionals
3. Per Beneficiary Max Rs. 70 lac
• Maximum 20 years for salaried class- holiday for
repayment of principle upto 12 months
• Businessmen : Max 15 years
• Step-up repayment/ bullet repayment option

17. Super Fast Car Loan
• Purpose: For purchase of new car
• Eligibility: Salaried persons / Businessman /
Commercial organizations
• Limit of loan: Max. Rs 100 lakh
• Repayment Period Salaried: Max 7 years.
• Businessmen : Max 5 year

18. Samruddhi - Loan against Property
• Purpose Personal expenses / Business Commitments
• Eligibility
Salaried / Businessmen / Professionals / Proprietary /
Partnership Firms as well as Private Limited Companies.
Property offered as security should be free from any
encumbrance.
• Limit of Loan
Salaried : Max Rs. 25 Lakh
Others : Max Rs. 50 Lakh
• Repayment Period Revolving line of credit OR
Term Loan with maximum repayment period of 5 years.

19. Multi Purpose Loan
• Purpose Personal Expenses
• Eligibility Salaried persons: Employee of reputed
organization with confirmed service of minimum
1year in the same organization
• Businessman/professional/self employed : Min
Net profit of Rs. 1.50 Lac p.a. for last three years
• Limit of loan: Max Rs. 2 lakh
• Repayment Period: Max 60 months
• Rate of Interest : 16%

20. Gold Loan Yojana
• Purpose To meet urgent financial needs
• Eligibility Any individual who is the true owner of
the ornaments
• Limit of loan
• Maximum loan / OD up to Rs. 25.00 lakh
• For Bullet repayment – 1 lakh
• Basis of Advance 75% of valuation of gold
ornaments or Rs. 2000/- per gm whichever is less
• Repayment period 12 months
• Rate of interest: 12.5%

21. Doctor Delite
• Purpose :For setting up clinic/ hospital. For purchase of
equipments / furniture at the clinic / hospital. To conduct
renovation of clinic /hospital.
• Eligibility
Any qualified Doctor (existing /new practitioner)
• Limit of Loan
• Maximum up to Rs. 100.00 lac.
• Repayment Period
For Premises & Equipments upto 120 months
Only for Equipments upto 84 months
Moratorium period upto 1 year may be granted on merits of
case
• Interest rate ranges from 12.5-13.5%

22. Saraswati Education
• Purpose For Education in India and Abroad
• Eligibility Individual who has secured admission
in any of the graduate/post-
• graduate courses offered by
college/institute/university approved by
IBA.Limit of loanStudies in India – Max upto Rs.
10.00 lacs
• Studies Abroad – Max upto Rs. 20.00 lacs
• Basis of Advance upto 100% of cost of the fees

23. Comparison
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Housing/Business Term PolicyEducation/Working Finance polocyLoan Against Immovable PropoertyPersonal Loan Policy
Interest Rates (%)
Retail Loans Corporate Loan