New Loan Facilities Launched for CSPs and Kiosk Operators to Boost Business Operations
In a bid to support Customer Service Providers (CSPs) and Kiosk Operators (KOs) engaged under the National and State-level Business Correspondent programs, banks have introduced tailored loan facilities aimed at meeting working capital and business expansion needs.
The facilities include Overdraft (OD), Demand Loan (DL), and Term Loan (TL), each designed to address specific financial requirements. Overdrafts help meet day-to-day working capital needs, Demand Loans cater to general business credit requirements, and Term Loans are available for acquiring fixed assets such as computers, printers, and furniture.
Loan Details:
- Eligible Borrowers: CSPs and KOs operating on a contractual basis, with one person per outlet.
- Loan Amounts: Minimum of Rs. 25,000. Existing CSPs/KOs with at least one year of engagement can avail up to Rs. 5 lakh, while new entrants can access up to Rs. 2.5 lakh.
- Interest Rates: Attractive rates linked to the borrower’s rating, scheme-specific rating, or prevailing bank guidelines. MSME loans are linked to the EBR (currently Repo Rate + 2.65%), while non-MSME loans follow a 6-month MCLR linkage.
- Borrower Contribution: No margin required for existing CSPs/KOs. For new borrowers, loans up to Rs. 50,000 require no contribution, while higher loans up to Rs. 2.5 lakh require 10%.
- Repayment: OD – 12 months with annual review; DL – up to 36 months with one month moratorium; TL – up to 84 months with up to three months moratorium.
- Processing Fees: Loans up to Rs. 50,000 are exempt from fees, while larger loans incur a 0.5% processing fee plus taxes.
The bank assesses loan amounts based on the borrower’s earnings. Existing CSPs/KOs are eligible for loans up to 12 times their average commission over the past 12 months. New CSPs/KOs receive loans based on need, in line with Mudra Loan guidelines. All loans must be covered under the Credit Guarantee Fund for Micro Units (CGFMU).
Eligibility Criteria: Borrowers must be between 18 and 60 years of age, have a valid agreement with the bank for financial inclusion services, and reside in their operational area for over three years. Additionally, CSPs/KOs should have been associated with the bank for at least one year.
Disclaimer: The information provided is for general awareness and guidance. Loan approval is subject to the bank’s terms, conditions, and appraisal process.
