Equipment Finance Scheme For Existing Clients TIIC

Equipment Finance Scheme For Existing Clients

Post By admin Tamilnadu

The TIIC launches a scheme for the Equipment Finance Scheme For Existing Clients. They head towards the aim of helping the startups and already existing users in any of the schemes. Also getting funding for equipment is a financial instrument. That provides business owners with financing to buy new machinery or repair existing machinery.

Financing for machinery is useful for both SMEs and large companies. Also, company owners and equipment loan firms enjoy tax advantages. Moreover, the rate of interest, loan amount, and tenure of the loan can vary from bank to bank. Finance leases, hire purchase contracts, operating leases, etc. are additional options connected with equipment leasing.

Eligibility Criteria for Equipment Finance Scheme

Individuals, partnership firms, limited liability partnerships, companies, trusts, and societies. All must include the following:

i. Should be in operation for at least three years.

ii. Must earn profits and stated dividends during the heading two financial years.

iii. Not involved in any default to institutions or banks in the payment of their dues.

iv. Hold positive net worth.

V. Income Tax Return (ITR) statements for the previous two years.

So, there are some significant documents you must hold as the existing client.

Benefits of TIIC Equipment Finance Scheme For Existing Clients

Equipment Finance Scheme For Existing Clients Benefits:

A) Instant Loan Penalty: – The TAT for all loan loans is very short. Usually, if all the documents you need are delivered by a client. It does not take more than a week to get a letter of punishment.

B) Decrease / Tax Benefits: – The maximum return on Equipment Loans reduces tax because decrease in the Balance Sheet.

C) Up to 80% Invoice Value: – Another advantage is that you can get up to 80% of the invoice amount. Also, including GST which gives you the flexibility to spend more on business.

D) Flexible Repayment Option: – Many flexible payment options are available today with various lenders. The bank offers you flexibility in payment options, various project cost-planning solutions, etc.

Purpose Equipment Finance Scheme For Existing Clients

Purpose of Equipment Finance Scheme For Existing Clients

A) First, under the Equipment Finance Scheme For Existing Clients. You get help for the purchase of plants and machinery. 

B) Secondly gets the building of identifiable items of plant and machinery. Also, includes generators for modernization, extension, balancing & replacement.

C) Also, Machinery imports directly are considerable and eligible.

D) Moreover, the transport charges and building charges are included in the project cost. It also, involves the extra civil work base, miscellaneous fixed assets, and electrical equipment. They can also become a part of the project cost and considerable.

Exclusion in Equipment Finance Scheme For Existing Clients 

So, help under the scheme not be available for the following:

  • Purchase of second-hand equipment or machinery
  • In-house fabrication of equipment or machinery
  • Reimbursement of the cost of tools or machine purchases more than 90 days before the date of application.
  • Grass root projects or major, enlargement, or diversification, that call for specific appraisal.

Documents Needed For Equipment Finance Scheme

Documents are required when applying for a machine loan. Also, it’s easy to verify your details and will help you get a loan. So, the following documents need to be submitted when applying for a machine loan, as follows:

  • KYC documents
  • Proof of ID: Aadhar card, PAN card, Passport, voter ID
  • Proof of residential address
  • Business address proof
  • Business registration Proof: – Partnership title / Certified copies of MOA / AOA
  • Bank statement 6 months ago
  • Latest passport-size photographs of the applicant or applicant
  • Two years ago Income tax and audited income
  • Supplier details and equipment names

Types of equipment and machinery in the scheme

Equipment financing can be to purchase types of machinery and equipment as :

  • Compactors
  • Fork Lifts
  • Crushing Plants
  • Drills
  • Road Rollers
  • Compressors
  • Dozers
  • Tipper/Dumpers
  • Hot Mix Plants
  • Wheel Loaders
  • Reach Stackers
  • Cranes
  • Backhoe Loaders
  • Excavators
  • RMC Plants
  • Graders
  • Concrete Pumps
  • Transit Mixers
  • Pavers
  • Rock Breakers
  • DG Sets

Limits of equipment financing amount 

Under the Equipment Finance Scheme For Existing Clients, the financing amount eligible is Rs.5 lakh to Rs.1000 lakhs. Moreover, take care you don’t purchase second-hand machines or do In-house fabrication of equipment or machinery.

Promoter’s Contribution

So, the promoter’s contribution is 15% for all the existing clients under the equipment financing scheme.

Debt Equity Ratio

So, the debt-equity ratio for Equipment Finance Scheme For Existing Clients is 2.00: 1.00 all over.

Repayment period

The loan repayment period for applying under the Equipment Finance Scheme For Existing Clients. So, the loan repayment period is 36 months to 60 months. Also, this includes the holiday period varying from 3 months to 12 months. To evade penalties, you must make the repayment on time. 

Collateral Security

So, the collateral security under the Equipment Finance Scheme For Existing Clients is assumed according to the existing policy guidelines. But 25% of the loan amount is minimum. So, it depends on the type of company, or business you are.

Conclusion

The TIIC Tamilnadu Industrial Investment Corporation Ltd develops various schemes for businesses which already exist or are new users. For a businessman who wants to purchase new equipment or machinery. Without straining working capital, equipment financing is an ideal choice.

Many people in business, however, assume that equipment loans are the only choices for large entrepreneurs. Are they doing well in the company by producing substantial revenues? Also, a loan for equipment applies to a small company. So, you use it for the scheme and get financial assistance.

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