Advance against Tangible Security

Purpose:

1. Personal Expenses

Eligibility:

1. The Life Insurance Policy( LIP) of any life insurance company should be in force for a minimum period of 3 years or having surrender value and should be assignable.
2. NSC/KVP should be minimum 1 year old.

Limits of Loans:

1. No limit

Basis of Advance:

1. NSC/KVP:
   1. 90 % of Face Value if residual maturity period is less than 3 years
   2. 85 % of Face Value if residual maturity period is more than 3 years

1. LIP:  90% of surrender value

Repayment Period:

1. 10 years in case of TL OR date of maturity whichever is earlier.
2. OD facility subject to annual review or date of maturity whichever is earlier.

Rate of interest (Floating): 

1. Floating (PLR: 6.35% p.a*) = 9.25% w.e.f 20.06.2025
2. Present PLR: 15.60% p.a*

Reset of Floating Interest Rate on Equated Monthly Instalment [EMI] based Loan:

1. Option to Switch ROI Type:
   Borrowers shall have the option to switch their loan from Floating Rate of Interest (ROI) to Fixed ROI and vice versa, subject to a maximum of two (2) switches in a financial year during the entire tenure of the loan.

1. Applicable Charges:
   A request charge of 0.50% shall be levied on the outstanding loan balance at the time of the switch, irrespective of whether the switch is from fixed to floating or floating to fixed ROI.

Penal Charges:

1. Penal charges in the range of 1% to 2% p.a. each, subject to maximum of 2% p.a. for non-compliance of terms and conditions of loan contract, till such time the same is complied with.

Security:

1. In case of LIP, the terms and conditions of the Policy should state that Policy can be assigned / Loan can be availed against the Policy.
2. KVP/NSC should be pledged/LIP should be assigned in Banks Name.
3. If it is against third party, policy holder should be taken as Co-applicant.

Processing Fees:

1. Nil

Shareholding:

1. Upto 1 Cr - Rs. 1000/-
2. Above 1 Cr - Rs.25000/-

Documents Required:

1. Prescribed loan application form