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Master Circular
On

Baroda Traders Loan

[Updated upto 30.09.2016]

Mortgages & Other Retail Assets Department

Bank of Baroda
Baroda Corporate Centre
Mumbai

Page | 1

INDEX
Sr.No.

TOPIC

Page
No.

(A)

INTRODUCTION

(B)

PRODUCT PROFILE

Baroda Traders Loan

II

Baroda Traders Loan to Commission Agents (Arthias)

19

III

Baroda Traders Gold Card scheme.

22

(C)

ANNEXURES

1.

List of Documents to be submitted by the Applicant

24

2.

Credit Rating Model

25

3.

Format for site verification of property mortgaged to Bank

29

4(a).

Fraud Prevention check list Pre sanction stage

30

4(b).

Fraud Prevention check list Post sanction stage

31

5.

Format of letter to Advocate for legal opinion

32

6.

Application form Baroda Traders Loan

35

7.

Appraisal Note Baroda Traders loan

38

8.

Pre Sanction Inspection Report Baroda Traders Loan

40

9.

F-135 : Particulars to be submitted by applicants

42

Page | 2

Introduction
Baroda Traders Loan (BTL) is one of the key products of Retail Loan basket available against
the security of immovable property/ies, which caters to the financial needs of business
entities engaged in trading of permissible goods.
The product provides hassle free advances for trading activities and therefore has received
good response from the traders as well as our operational units. The credit limits are
assessed on the basis of the projected turn over and the advance value of the property
offered as security.
Further, a new product Baroda Traders Loan against Gold Ornaments/ Gold
Jewellery/Gold Coins was launched on 24.09.2010.
As per the scheme guidelines of Baroda Traders Loan, Borrowers are not considered any adhoc/ excess over the limit sanctioned under the Scheme. Based on the feedback received
from Zones/Regions, a need was felt to meet the emergent working capital requirement
arising out of peak season requirements, delayed payments by debtors, tax payment etc.
With a view to cater to such financial needs of our existing Baroda Traders Loan borrowers,
a new Retail Loan Asset product named Baroda Traders Gold Card Scheme was
launched on 30.04.2013. The Scheme provides for sanctioning of additional limit to the
extent of 20% of the sanctioned limit under Baroda Trader Loan. This should enable our
operating units to satisfy the needs of our existing borrowers with good track record.
In order to build a customer centric and competitive presence under Retail Lending, Bank
has reviewed the Traders Loan product with superior product features and competitive
pricing which will help the Bank to be the preferred bank for quality customers, while
managing the risk on the book and ultimately driving profitability for the Bank. Accordingly,
major parameters of Traders Loan scheme has been modified and introduced risk based
pricing linked to Bureau score of the applicant/s w.e.f. 23.05.2016.
The key modifications as per the revised guidelines of Traders Loan include the following:
Risk Based Pricing: Internal Rating linked Rate of Interest for Traders Loan
Stipulation of Bureau Score Cut off
Enhancement in maximum amount
Relaxed margin & security norms
Discontinuation of scheme of Traders Loan against Gold Ornaments / Jewellery
With the modifications in ceiling on maximum limit and substantial reduction in rate of
interest for quality proposals coupled with other modifications in the parameters/ guidelines,
our Baroda Traders Loan product have become more competitive and robust in the market.
The detailed features of the Baroda Traders Loan product are mentioned in the following
sections.

Page | 3

BARODA TRADERS LOAN: PRODUCT PROFILE

No
1

Parameter
Target Group

Guidelines
Individuals, Proprietorship & Partnership Firms, Private
Limited Companies and Registered Co-operative societies
engaged in trade of any commodity / goods in physical
form required by the community and trading in them is
not prohibited by law or opposed to public interest.
Dealers in Silver / Gold Jewelery.

Eligibility

HUF & Public Limited Companies are not eligible.

The business units should be profit making (net profit
before tax as per last -2- years **audited balance
sheet) and should be established in the line of business
for a minimum period of -2- years. (**wherever
applicable)
For a partnership firm, PBT (Profit before Tax) will be
considered after adding remuneration to partners and
interest on partners capital.

Trading units established by our existing Current

Account or Advance Account customers with
satisfactory dealings for the last -1- year or their close
relatives can be considered, even if these are
established for less than -2- years.

Other cases of Trading units having less than -2- years

establishment can be considered with the prior approval
of RMCC

3
4

Nature of Facility
Purpose

In case of Dealers in Silver/Gold Jewllery, finance should

not be made available to traders dealing in bullion / raw
gold. Borrowers to comply with the Licensing
requirement for the business.
Activity Clearance to be obtained for applicable activities/
industries as per Circular No. BCC: BR: 107/171 dated
16.04.2015 and BCC:BR:108/103 dated 03.03.2016.
Overdraft / Term Loan / Non Fund Facility

Overdraft: Working capital requirements

Term Loan: Development of shop

(Purchase of equipment, Computer, Air-Conditioner,
Furniture etc.; but not for purchase of shop, for need
based requirements subject to a maximum of 25% of the
working capital limit sanctioned.

Non-fund based facilities (Letter of Credit & Bank

Guarantee):
- Non fund facility can be considered over and above
the Working capital / Term Loan limit, but within the

Page | 4

limit assessed based on value of securities and upto

the specified maximum limit under the scheme.
However, if requested non fund based limit cannot be
accommodated separately based on projected
turnover or offered securities, the same can be
considered as a sub limit of working capital limit.

Activity Clearance to be obtained from Corporate Office /

Zonal authority wherever applicable for activities / industries
mentioned in the Domestic Loan policy.
Limit (Ticket Size) Minimum: (for fresh exposure w.e.f. 23.05.2016)
Rs.2.00 Lacs (Rural / Semi Urban Branches)
Rs.5.00 Lacs (Urban / Metro Branches)
(Existing accounts with limits less than the minimum
stipulation can be continued under the scheme)

Maximum:
Metro branches
: Rs.10.00 Crores
Urban branches
: Rs.5.00 Crores
Semi Urban branches : Rs.3.00 Crores
Rural branches
: Rs.1.00 Crores

Assessment of Working Capital limit:

The credit limit is to be considered as under:
20% of the accepted projected Sales; subject to verification
of Sales Tax returns of the previous years / quarters.
OR
Advance Value of collateral assets to be charged, whichever
is lower.
Assessment of Loan for Shop Development:
Need based finance to be considered as per requirements
subject to a maximum of 25% of the working capital limit
sanctioned (within overall limit assessed based on value of
security).
However, Working Capital Advance & Loan for Shop
Development together should not exceed advance value of
collateral security or maximum limit specified for the
scheme.
Note: In case of Overdraft facility to dealers of Gas agencies
/ Petroleum filling stations/Pumps, while assessing the
working capital requirements, need based amount to be
considered based on the capacity of the godown / fuel
storage tank etc. As such, in such cases, assessment of
working capital should not be done purely based on the sales
turn over/ projected sales, but we may consider the actual
working capital requirement based on the godown/ fuel
storage capacity

Page | 5

Bureau score
based validation
(For fresh
sanctions and
enhancements)

CIBIL verification for Proprietor / Partners / Directors to

be carried out.
(Consumer Bureau CIBIL Trans Union Score under
version-1).

Cut Off on CIBIL score will be at 725.

For Partnership Firm or Pvt Ltd Company, all the

partners / directors should have minimum CIBIL Cut
Off score for considering fresh exposure.

Score 675 to less than 725: Deviation decision with

RMCC.
Less than 675: Deviation decision with ZOCC.

(-1) or (0): Can be considered by the sanctioning

authority with proper justifications.

At the time of review, in case of Term Loans & Demand

Loans, deviations in CIBIL score, if any, need not to be
referred to deviation authority as mentioned above.
Credit Card default of Proprietor / Partners / Directors:
Cases where credit card account status write-off /
settlement involving amount upto Rs.25,000/- No
deviation is required (in case of fresh, review with
increase & takeover proposals)
Cases where credit card account write-off / settlement
involving amount above Rs.25,000/- took place in the
past: Deviation powers rest with the authorities as
under:
Parameter
Authority
For proposals falling upto the powers of ZOCC
RMCC
For proposals falling under the powers of COGM (BCC)
ZOCC
In case of review of accounts, sanctioning authority may
take a view in all such cases without referring for deviation.
While accepting the credit card account write-off /
settlement above Rs.5000/- sanctioning authority to ensure
the following:
No Due certificate from the Bank / FIs be obtained in
respect of credit card account
Borrower is impressed upon for updation of
satisfactory status with the concerned Bank / FIs,
preferably within stipulated period.
Ensure that Bureau Report of the applicant/s contains
no other adverse remarks.

Page | 6

Rate of Interest

In case of multiple deviations in Bureau score which are

to be considered at various levels (i.e. one at RMCC &
another at ZOCC), all the deviations in Bureau score to
be considered at higher level (i.e. ZOCC).

The pricing is linked with Internal Risk Rating as under:

(w.e.f. 23.05.2016)
For
BTL-1/BOB1
to
BTL-4/BOB4
rated
accounts: MCLR -1 year + Strategic Premium +
1.50%
For BTL/BOB 5 & BTL/BOB 6 rated accounts:
MCLR -1 year + Strategic Premium + 2.00%
For below BTL/BOB 6 rated accounts:
MCLR -1 year + Strategic Premium + 2.50%
No fresh exposure below BTL/BOB-6
Note:
In case of accounts having rating below BTL/BOB-6,
applicable ROI will be with maximum spread as per the
product.
At the time of Review:
For sanctions w.e.f. 23.05.2016 (Demand Loan/Term
Loan/Overdraft):

At the time of annual review of accounts (with

respect to sanction date), the Risk based pricing
linked to Internal rating of the borrowers and Bureau
score validations for Proprietor / Partners / Directors
to be applied.
As such, effective ROI from the date of review will be
based on the Internal Rating of the borrower. The
credit spread based on the Internal Rating prevailing
at the date of review, to be added to 1 year MCLR+
Strategic Premium for arriving the effective ROI for
the particular account.

For sanctions prior to 23.05.2016:

For Term Loans & Demand Loans sanctioned prior to
01.04.2016 and continuing with Base Rate system:

The same ROI structure with existing spread over

Base rate will be continued till its maturity /
repayment and existing rules of Base Rate will be

Page | 7

applicable. At the time of review, same ROI structure

with existing spread over Base Rate will continue.
Risk based pricing linked to internal rating of the
borrowers need NOT to be carried out for Term
Loans & Demand Loans sanctioned prior to
01.04.2016 and continuing with Base Rate system.
For Term Loans & Demand Loans sanctioned prior to
01.04.2016 and subsequently opted for MCLR linked
reference rate:

Repayment
Period

At the time of Review, same ROI structure with

existing spread over 1 year MCLR+ strategic Premium
will continue without Risk based pricing (linked to
internal rating).
In case the borrower opts conversion to MCLR at the
time of review, the existing credit spread over Base
Rate for the particular account to be added to 1 year
MCLR+ Strategic premium for arriving the effective
ROI from the date of review.
Traders Loans sanctioned as a Term Loan from
01.04.2016 to 22.05.2016 also, risk based
pricing linked to internal rating of the
borrowers will not be applicable at the time of
annual review.

For Overdraft accounts sanctioned prior to 01.04.2016:

For overdraft account, at the time of annual review,
the rate of interest to be converted from Base Rate to
MCLR linked reference rate invariably.
Further, for Overdraft accounts, , at the time of
annual review of accounts (with respect to sanction
date), the Risk based pricing linked to Internal Rating
of the borrowers and Bureau score validations for
Proprietor / Partners / Directors to be applied.
As such, effective ROI from the date of review will be
based on the Internal rating of the borrower. The
credit spread based on the internal rating, prevailing
at the date of review, to be added to 1 year MCLR+
Strategic Premium for arriving the effective ROI for
the particular account.
Loan: Maximum 60 months (depending on repayment
capacity).
Overdraft: 12 months, subject to annual review
Adoption of Specific Pre fixed EMI dates for Retail
Loans:
As
per
the
guidelines
conveyed
vide
Circular
No.BCC:BR:108/404 dated 02.09.2016, Branches have to
adopt prefixed specific dates - 08th or 16th or 25th as EMI

Page | 8

dates for all Retail Loans, out of which the preferable date
convenient to the borrower, considering the salary date/
monthly remittance dates etc. In any case, even in case of
loans with moratorium also, the dates - principal demand
date/ interest demand date/ first repayment start date
should be uniform for a particular account and should be
08th or 16th or 25th. The above guidelines are applicable to
all the fresh sanctions of Retail Loans w.e.f. 10.09.2016.
9

Credit Rating /
Cut off

Internal Credit Rating to be done at the time of sanction

/ review of the account.

Facilities upto Rs. 2.00 Crores to be rated under Retail

Rating Model- BTL Model, hosted in LAPS

Facilities of more than Rs.2.00 Crores to be rated on

BOBRAM.

Internal Credit Rating cut off:

Limits up to Rs.2.00 Crores BTL Rating: BTL-6
Limits above Rs.2.00 Crores - BOBRAM Rating: BOB-6
No fresh exposure below BTL-6 / BOB-6 w.e.f. 25.05.16

10

Security & Margin

External credit rating is to be done where exposure is

above Rs.5.00 Crores under Baroda Traders Loan

Margin : 40% on Realizable Value of immovable properties

Security:
(I) Mortgage of Immovable Properties:
- Residential Property (House / Flat)
- Commercial property (Building / Land & Building)
- Plot of Land (not agricultural land)
Note:
In case plot of land, it should be identifiable by
boundaries / demarcation.
In case of any type of Tenanted properties, adequate
measures to be taken to safeguard Banks interest.
Guidelines of Circular No. BCC:BR:106/406 dated
14.10.2014 issued by Legal Department, BCC
regarding precautions to be taken while accepting
tenanted property as security should be followed
scrupulously.
Normally, property standing in the name of Borrower
(including
Partnership
firm/
Private
Limited
Companies), Proprietor, Partner, Director or their
close relatives is to be mortgaged.

Page | 9

However, the property standing in the name of third

party can also be accepted, provided the owner of
property offers his / her personal guarantee.
Periodical asset verification to be done as per extant
guidelines i.e. once in a year.
II) National Savings Certificates, Government Bonds, our
Banks Term Deposits and Assignment of Life Insurance
Policies etc. standing in the name of the Borrower /
Proprietor / Partner / Director only.
Margin:

10% on Banks own FDRs.

15% on the surrender value of Life Insurance Policies

and face value of NSCs, Government Bonds etc.

Valuation of Property:

The property being accepted as security should be got

valued by our Banks approved valuer at the time of
considering the facility.

Further, the valuation is to be done once in -3- years.

In case of Limit above Rs.1.00 Crore, 2nd valuation of

the property also to be obtained and to be satisfied upon.
The lower of the two valuations to be considered while
calculating the Limit.

In case of properties acquired within last -3- years,

amount of Registered Sale Deed should be taken as
value of the property.

If the present Realisable value is higher than the

Registered value (Registered within last 3 years) and if it
requires to consider present Realisable value as value of
property, for any reason, prior permission from Regional
Authority to be obtained for the same.

Age of Property
a.) In case of loans:

Age of property should not be more than -25- years old.

Page | 10

However, the property, which is older than -20- years

but not more than -25- years, Branch to ascertain
structural soundness of the property by obtaining an
Approved Engineers certificate, certifying structural
soundness and expected residual life of the building,
which should be at least -5- years more than the
repayment period of the loan.

For dwelling units which are older than -25- years,

Regional Head may authorize such cases on selective
basis, subject to ascertaining structural soundness of the
building by obtaining an Approved Engineers certificate,
certifying structural soundness and residual life of the
building, which should be at least -5- years more than
the repayment period of the loan.

b.) In case of overdrafts:

11

12

Sanctioning
Authority
Documentation

Building less than 25 years old: Guidelines as applicable

to general advances to be followed.
Older than 25 years: The Branch will be required to carry
out inspection of the property every year at the time of
review of facility and obtain structural soundness report
from Architect every 3rd year along with valuation of the
property.
In case any defect is observed during inspection of the
security or in Architects Report, Branch will be required
to ensure substitution of the security having requisite
value immediately or ensure liquidation of the facility at
the earliest but not later than 12 months period in any
case.
As per discretionary lending powers.
Since Baroda Traders Loan being a business loan per party /
group discretionary lending powers will be applicable.
D. P. Note (as per constitution of the Borrower).
Letter of continuing security (in case of overdraft facility)
Letter of installment (in case of Term Loan facility)
**Agreement of Hypothecation of Goods covering
Stocks, Equipment / other items as the case may be,
purchased out of bank finance (wherever applicable).
Mortgage / Pledge / Assignment of collateral securities
(as per terms & conditions of the sanction).
General form of Guarantee in case the immovable
property charged to Bank is in the name of other than
Borrower/s.
Undertaking from the Borrower to exclusively deal with
our Bank.
Undertaking from the Borrower declaring that he does
not owe any overdue statutory dues like Sales Tax,
Income Tax, Corporation Tax, Professional Tax etc. and

Page | 11

13

Insurance

14

Unified
Processing
charges

has obtained / renewed licenses from concerned

authorities required for trading in the merchandise /
goods every year.
Other documents as per constitution of the Borrower and
terms & conditions of the sanction.
For Non-Fund based facilities, as per extant guidelines.

**Note: Agreement of Hypothecation of Goods is

desirable, though in all the cases the same is not
compulsory, if the conduct and reputation of the client is
very good in the market. The branches, however, should
obtain an undertaking from the borrower to the effect
that the borrower shall execute the Agreement of
Hypothecation of Goods as and when required by the
Bank, to safeguard interest of the Bank in case of any
eventuality arising at a future date.
Property mortgaged should be insured as per Banks norms.
Obtaining insurance of the stocks may not be a condition for
sanction of the facility. However, Branches may counsel their
Borrowers to have the stock insured in their own interest at
their cost.
Bank has revised the unified processing charges and
modified method of recovering processing charges w.e.f.
01.07.2016 as under:
1. The

unified processing charges will include:

Processing Charges
Documentation charges
Document Verification/ vetting charges
Pre- sanction Inspection (Contact Point VerificationCPV) charges
One time post inspection charges
Advocate charges for legal opinion
Valuer charges for valuation
Bureau report charges
CERSAI charges
ITR Verification charges

2. For Traders Loans, certain minimum amount of processing

charges will be recovered upfront. Balance amount of
processing charges will be recovered at the time of
conveying sanction of the loan. (In case of securities
other than immovable properties no upfront charges)
3. Further, stamp duty payable on various loan
documents/ agreements as well as for equitable
mortgage shall be recovered separately on actual basis.
The revised unified processing charges for Traders Loans
w.e.f. 01.07.2016 is as under:

Page | 12

0.35% of Loan / OD Limit, without any maximum amount.

Minimum: Rs.7,500/- (Upfront)**
** The above charges considered as if only one property is
offered as security. If two or more properties are offered as
security, Rs.7,500/- per each additional property would be
applicable as upfront charges in addition to normal changes
as mentioned above.
Review Charges:
No charges on Review in case of Term Loan /
Demand Loan accounts.
In case of Overdraft accounts, the processing
charges as mentioned above to be recovered i.e.,:

0.35% of OD Limit, without any maximum

amount.

For Overdrafts accounts, processing charges are on

per annum basis, i.e. if a proposal is reviewed
after six months from the due date for a
further period of 12 months, processing charges
are to be levied for 18 months.
In case of review with enhancement, the review
charges to be taken for entire amount of limit
including enhanced portion.
However, if the enhancement is before the due date
of next review, processing charges to be taken for
the proportionate period for the existing limit and full
processing charges to be taken for the enhanced
portion.
Eg: Sanctioned/ last reviewed on: 01.01.2016 for
Rs.50 Lacs
Enhancement to Rs.60 Lacs on : 30.06.2016
Processing Charges to be calculated as under:
For Rs. 50 Lacs: Proportionate charges for 6 months
For Rs.10 Lacs : Full processing charges

15

Mortgage
Creation charges

Separate charges for periodical inspection of stock /

goods not to be charged
Mortgage Creation charges as per extant guidelines will be
applicable

16

Pre-payment
Charges

Pre closure within -12- months of initial sanction : 2%

Pre closure after 12 months of initial sanction : Nil

Overdraft facility: Prepayment charges will be calculated on

the sanctioned limit
Term Loan: Prepayment charges to be calculated based on
amortization balance as per repayment schedule.

Page | 13

17

Commitment
charges

0.50% p.a. for utilization of limits below 75% (on quarterly

average Basis) of sanctioned limit in case the Limit
sanctioned is Rs.500 Lacs and above.

18

Priority Sector
Classification
Take over Norms

As per new definition of priority sector applicable to MSE.

19

The operating units may take over good quality

accounts from other Banks subject to complying with
non-financial norms laid down in Domestic Loan Policy /
guidelines advised from time to time.
In case of takeover of retail loan accounts from other banks,
no prior clearance for takeover of accounts is required from
Regional Head / Zonal Head.
The entity must also satisfy following financial norms:
Current Ratio
: Minimum 1.17:1
Debt Equity Ratio : Maximum 6:1
Besides above, operating units must also ensure compliance
of norms for Takeover of Borrowal Accounts from other
Banks in terms of Circular No BCC:BR:104:305 dt
27.08.2012.

20

Other Provisions

Any adhoc or excess over the sanctioned Overdraft Limit

or separate TOD in Current account of the borrower is
not to be allowed under the Scheme; so as to maintain
stipulated margin on the securities charged to the Bank.

As per the Scheme, it is mandatory that the borrower

deals exclusively with BOB. As such, while sanctioning or
reviewing Overdraft facility / Loan under BTL Scheme;
this vital condition is required to be stipulated and
account to be monitored accordingly.

At the time of fresh sanction or takeover of the account

from other Bank, it is to be ensured that current
account/s maintained with other Bank/s is closed. Similar
exercise to be done at the time of review of facility.

Loan for shop development should be disbursed by direct

payment to suppliers. Branch to ensure end use.

If Government Bonds / National Savings Certificates /

Life Insurance Policies / Bank Deposits are offered as
security, Banks extant guidelines / norms to be followed
for lien / assignment.

Where security is in the form of our Banks FDR, the

same should be appropriated in case there is a default in
servicing interest for one quarter and a/c slips to NPA.

Page | 14

Borrowers will not be considered for Working Capital

assistance both under Baroda Traders Loan as well as
under any other usual scheme for Retail Traders
simultaneously.

However, Retail Traders enjoying finance under the

existing scheme can have the facilities transferred into
Baroda Traders Loan, if they so desire, after providing
the collateral security as per the Scheme

Any new sanction or renewal of existing facility to be

done only after getting & verification of IT/ST/VAT
statements.

However, if the business unit is not under the

requirement of VAT return / Service Tax return / Audited
Balance Sheet, minimum 60% turnover as reported in
the last Balance Sheet must have been routed through
operative account. If the turnover is not justifiable with
the account statement, sanctioning authority has to
satisfy itself and justifications to be mentioned in the
Appraisal.

Pre-sanction inspection to be conducted and report to be

kept on record.

In case of Overdraft facility, if the credit turnover in the

account in the preceding month is not adequate to cover
the interest debited, then interest debited needs to be
recovered separately.

Borrowers to route the sales and all other transactions

through their Overdraft or Current A/c (in case of loan)
with the Branch.

Branches are required to ensure that the funds are used

in business and are not diverted.

Stock statement to be obtained once a year i.e. as of last

day of February, by 10th of March every year.

Stock etc. should be hypothecated; however, monthly

submission of stock statements and periodical inspection
may be waived.

Inspection to be carried out once in a year and

inspection report to be kept on record.

Stock /Book- Debt Audit will NOT be applicable for

facilities sanctioned under Baroda Traders Loan scheme.

Page | 15

(as clarified vide circular No.BCC:BR:108 / 162 dated

04.04.2016)

Obtaining of financial statements i.e. Balance Sheet and

Profit & Loss A/c is dispensed with.
However, declarations on annual sales supported by
Returns/Assessment on Sales Tax, Income Tax etc. be
obtained and kept on record at the time of annual
review.
In case the Audit of Financial Statements of the
Borrower
is mandatory due to statutory
provisions, Audited Financial Statements to be
obtained and examined at the time of fresh
sanction as well as at the time of Review.

As per Income Tax rules, from the Assessment Year

2013-14, if the total sales turnover or gross receipt in
business of the firm for the previous year relevant to the
assessment year exceeds Rs.1 Crore, the firms are
required to get their accounts compulsorily audited by a
Chartered Accountant.
Therefore, audited balance sheet need to be
obtained from traders having total sales, turnover
or gross receipt in business for the previous year
relevant to the assessment year exceeds Rs.1
Crore.

In order to undertake Credit Rating in CRISIL module

for loans above Rs.200/- Lacs, branches are required to
obtain all necessary financial papers.

In case of Guarantee and L/C, Banks extant guidelines to

be observed.

21

Deviation powers

22

Baroda Traders
Loan against
security of Gold
Ornaments /
Gold Jewellery /
Gold Coins

Branch to ensure that Borrower displays a plate

describing Our bankers- Bank of Baroda------- Branch.
Other Financial/non-Financial Deviations/Concessions in
respect of scheme parameters/ guidelines may be
considered as per Circular No.BCC: BR: 108/53 dated
29.01.2016.
The scheme discontinued w.e.f. 23.05.2016.

Page | 16

23

24

Finacle & Ascrom

Codes

Preventive
Vigilance

Product

Finacle
Code

Ascrom Code

Baroda Traders Loan

LA162,
OD006,
OD017

710

Baroda Traders Loan against

Gold Ornaments/Jewelley/
Gold Coins (scheme
discontinued)

LA177,
OD018

906, 907

KYC guidelines should be very meticulously and strictly

complied with, which include proper verification / cross
checking of information submitted by the applicants for
their identity. Documents submitted for identity and
proof of residence i.e. copy of ration card/ photo-identity
card/ PAN card/ driving license should be properly
scrutinized and also verified with the originals. Noting for
having verified with the originals should be made on
relative documents and report kept on record.
Authenticity of income tax returns and other supporting
documents submitted by borrowers are independently
verified.
The taxpayers original copy of challans of tax deposited
and details of deductions claimed under chapter VI A
must be verified to ascertain genuineness of Income Tax
Returns and also the assessment orders for earlier years.
The system for outsourcing Chartered Accountants for
verification of income related papers viz. IT Returns,
Income Tax Challans etc. is in place. Therefore the work
of verification of income related papers should be
assigned to the authorized agency / persons in
consultation with Zonal & Regional Office.
Critical examination and satisfaction about the
Employment/Business Status of the applicant, for
source, continuity, consistency and sustainability of the
income is very essential. The cases of doubtful
employment/business status should be discouraged.
CIBIL data in respect of applicant/s should be
meticulously verified leaving no scope for non-detection
of identity of the applicants.
The sanctioning authority /Branch Official must visit the
site and get satisfied with the genuineness of valuation
of the security, keeping a record thereof and should not
solely depend on the Valuers report.

Page | 17

 Search Report/ legal opinion obtained about immovable

property from Banks approved advocate should be
exhaustive and complete containing all vital points. The
Branch officials should carefully study the report received
from the advocate and any point affecting Banks
interest may be probed into.
Legal opinion of the document should be based on
examination of original title deed only and not on
the basis of the photocopies.
In order to ensure that panel advocate incorporates all
vital points in his report relating to the property offered
as security such as non-encumbrance, marketability and
title of the property, the branches are advised to send
letters to Advocates as per model draft (Annexure -5)
while seeking his / her opinion.
Reports which do not contain the information on the
points mentioned in the branch letter (as per draft) must
not be accepted.
The advocate to certify that the title deeds relating to
concerned property are original, duly stamped and
wherever required duly registered and title is clear,
marketable and free from encumbrances.
Equitable mortgage of immovable property should be
based on original Title Deeds only. All previous chain of
title documents and other papers suggested by Banks
advocate should be obtained while creating equitable
mortgage on the property proposed as security.
MONITORING RISING NPA:
i.
ii.

iii.

It is observed that NPAs in Baroda Traders Loan is increasing, which is not a healthy sign.
This indicates that the accounts are not being closely monitored, as branches probably
have a feeling that these are secured advances duly backed up by tangible securities.
The objective of Baroda Traders Loan is to provide a simple hassle-free and security linked
advance, where neither the drawing power is determined by value of stock nor traders are
required to submit various financial statements and monthly stock statements. It does not
mean that due monitoring of the account is to be neglected. For ensuring proper health of
the account it is very much essential that the conduct of the account and turnover in the
account is monitored by the branches carefully to ensure that the assets are not allowed
to become NPAs.
Branches should, therefore, diligently monitor all Baroda Traders Loan advances
accounts.

Page | 18

II- BARODA TRADERS LOAN TO COMMISSION AGENTS (ARTHIAS)

Commission Agents (Arthias) deal in trading of food grains, pulses fruits, vegetables etc on
commission basis at krishi mandi (anaj mandi, fruit/sabji mandi). The main activity of the
Arthias is to sell the food grains/fruits/vegetables etc on commission basis and are the link
between the farmers / growers and the distributors / whole salers / retailers. They book the
order on the behalf of the buyers and procure the stock from the sellers i.e. farmers /
growers and supply same to the buyers and charge commission on the products to be
supplied.
The Arthias are also responsible for collecting due VAT/Sales tax & Mandi tax from buyers to
deposit the same with concerned authorities as per the guidelines/ law prevailing in the
state /local area and also at times undertake responsibility of realization of debtors between
seller and buyer. As such, their commission remains higher when compared to simple
brokers who only work as a mediator between seller and buyer without undertaking any
responsibility of realization of debtors. Further, such Arthias book only commission income in
their books i.e. P&L account; whereas in the Balance sheet they show debtors for the full
amount i.e. amount of goods sold + commission.
Considering the importance of grain/vegetables & fruit Markets, some of our branches
established in and around grain markets are also providing finance to such merchants under
BTL scheme. However due to area specific scheme by peer banks at soft and concessional
terms, we are not able to compete and our market share is insignificant so far in comparison
to other peer banks.
As per present RBI guidelines, the loan to Arthias is excluded from the priority sector
coverage. In view of various changes taken place in the market/overall scenario during the
last couple of years i.e. increase in quantum of credit requirement, increase in competition
and looking to the vast potential for credit expansion as well as liberal norms adopted by our
competitors/peer banks and above all considering the valuable feedback received from our
branches, a need felt to introduce a scheme under retail segment for such commission
agents/Arthias. Accordingly, Bank a new scheme Baroda Traders Loan to Commission
Agents (Arthias) under the Baroda Traders Loan was launched.
BARODA TRADERS LOAN TO COMMISSION AGENTS (ARTHIAS): PRODUCT PROFILE
Parameters
Target Group
Area of Operation
Nature of Facility

Guidelines
Commission Agents/Arthias, engaged in Retail Trade, who
undertake responsibility of realization of debtors
All Branches
Overdraft

Purpose

Working Capital requirement

Eligibility

1. Commission agents/ Arthias (functioning in markets / mandies)

who are engaged in trade activities on commission basis and
enjoying good reputation in the market with Two years of
experience in the line of their business activity (i.e. extending
credit to farmers, for supplying of inputs as also for buying the
output from the individual farmers / SHGs / JLFs).
2.
3. They should be registered with the Market Committee and possess
a valid license issued by the Authorised government agencies.

Page | 19

4. New Arthias (during first year of operation) will also be eligible

provided they have minimum 2 years of working experience /
family background in this line of activity.
5. HUF & Public Limited Companies are not eligible.
Minimum : Rs. 25,000/Maximum :
- Rs. 100 Lacs for Rural/Semi Urban/ Urban Branches
- Rs. 200 Lacs for Metro Branches

Limit

Assessment of working Capital limit :

The credit limit is to be considered on the basis of commission
income shown in P&L account (instead of sales) as under:
-8- times of commission / brokerage / Aarath received /earned as
per last Audited Balance Sheet or 8 times of such average income
for last three years, whichever is less (assuming 2.50%
commission X 8 times = 20% of Sales)
Or
**Advance Value of immovable properties to be charged or 90%
value of FDR or 85% value of NSCs / surrender value of LIC
policies/ Government bonds etc., whichever is lower.

Rate of Interest
Unified
Charges

** Advance Value: 60% on Realizable Value (RV) of the

immovable properties (in similar lines to Traders Loan Scheme)
Refer Point No.10 of product profile of Traders Loan.
Same Pricing as Traders Loan scheme

Processing 0.35% of the limit sanctioned without any maximum amount.

Minimum:Rs.7,500/-(upfront)**
** The above charges considered as if only one property is offered
as security. If two or more properties are offered as security,
Rs.7,500/- per each additional property would be applicable as
upfront charges in addition to normal charges as mentioned
above.

Period

Review Charges:
As mentioned in Traders Loan Scheme
-12- months, subject to annual review

Repayment

On demand

Sanctioning
Authority
Deviation powers

As per discretionary lending powers

No financial deviation is allowed.
Non-Financial Deviations/ Concessions in respect of scheme
parameters/ guidelines may be considered as per Circular No.BCC:
BR: 108/53 dated 29.01.2016 on the lines as applicable under
Baroda Traders Loan Scheme.

Page | 20

Other conditions

Branch to obtain copies of Registration Certificate from Sale

Tax deptt and from Krishi Upaj Mandi of the concerned
town/village.

Branch to obtain Audited Financial Statements of the applicant

Borrower (if the sales turnover based on commission income is
more than Rs 100 lacs or more) and it is mandatory. Audited
Financial Statements to be obtained and examined at the time
of fresh sanction as well as at the time of each review.

Branch to ensure that VAT is actually paid and return is filed by

the Commission Agent/Arthias. The return should match with
the commission income.

Other Parameters

All other parameters/ guidelines viz. security, margin on securities,

sanctioning authority, documents, insurance, credit rating, take
over norms, other provisions etc as applicable to Baroda Traders
loan will be applicable to Baroda Traders Loan to Commission
agents (Arthias).

Finacle Scheme Code

OD023

Page | 21

III- BARODA TRADERS GOLD CARD SCHEME: PRODUCT PROFILE

Nature of facility
Eligibility

Credit Rating

Purpose

Limit & Margin

Overdraft
Individuals, Proprietorship & Partnership Firms, Private Limited
Companies and Registered Co-operative Societies engaged in
trade of any commodity/goods and have been sanctioned
overdraft facility under Baroda Traders Loan Scheme above Rs.25
Lacs and fulfilling the following criteria:
1. Existing account in Standard Asset Category for last 2
years
2. No major inspection irregularity in the account
Minimum BTL 4 for limit up to Rs.200/- Lacs including
proposed limit under Baroda Traders Gold Card.
Obligor rating of minimum BOB-4 for limit above Rs.200/Lacs.
To meet the emergent working capital requirement arising due to
peak season requirements, delayed payments by debtors, for tax
payment, etc.
Assessment of limit:
The credit limit is to be considered as under:
20% of the sanctioned Baroda Traders Loan Limit
OR
70 % of realizable value of immovable property (including
realizable value set aside for sanctioning of regular Baroda
Traders Limit), whichever is lower.
Margin: 30% of realizable market value of immovable property
In case of other securities like FDRs, Life insurance
policies, NSCs, Government Bonds etc.:
20% of the sanctioned Baroda Traders Loan limit
OR
The residual portion of the value of securities after keeping
sufficient margin as under for the overall limit, whichever is
lower.
Margin:
10% on Banks own FDRs.
15% on the surrender value of Life Insurance Policies,
NSCs, Government Bonds etc.
(The above margin is to be worked out for arriving total limit of
Traders Loan Limit + Traders Gold Card Limit)

Page | 22

Security

Rate of interest
Processing charges
Documentation

Extension of equitable mortgage of property/ies

mortgaged.
National Savings Certificates, Government Bonds, our
Banks Term Deposits, Assignment of Life Insurance
Policies, Govt. bonds etc. standing in the name of the
Borrower /Proprietor/ Partner/Director only.
50 bps over applicable ROI on the sanctioned Baroda Traders
Loan Overdraft facility.
Unified processing charges @ 0.35% + service tax
i)

D P Note as per constitution of borrower

ii) General form of Guarantee LDOC -33

iii) Letter of continuing security- LDOC-7
iv) Hypothecation of stocks (wherever applicable)- LDOC-17B
/ 17C
v) Extension of Mortgage of Property
vi) Documents for other securities, if any.
Note: Documents as above for Gold Card Scheme to be obtained
in addition to documents obtained for ODBTL facility
Period

12 Months - to be allowed on 3 occasions in a year for a

maximum period of 2 months on each occasion. However, there
should be gap of 1 month between two drawls

Sanctioning
Authority

As per discretionary lending powers.

(Limits to be considered including proposed limit under Baroda
Traders Gold Card)

Baroda Traders Loan against security of Gold Ornaments / Gold Jewellery / Gold
Coins:
The scheme discontinued w.e.f. 23.05.2016.

Page | 23

Annexure-1
LIST OF DOCUMENTS/PAPERS TO BE SUBMITTED BY APPLICANTS
1.
2.
3.
4.

5.

Application Form duly filled and signed by applicant / proprietor/ partners/

Directors /guarantor. (Annexure- 6)
Form No. 135: Details of applicant/proprietor/partners/Directors/ & family &
Assets & Liability (Annexure- 9)
(Investment Details with supporting Xerox documents like NSC, LIC, etc)
Two Passport Size Photograph of applicant/guarantor.
Personal Identification Proof of applicant / proprietor/ partners/ Directors
/guarantor (Any one of below)
a. Passport
b. PAN Card
c. Voters Identity Card
d. Driving License
e. Aadhar Card
f. Photo identity issued by any public authority having proper record of issuance
of identity proof which is verifiable from records to the satisfaction of the
Bank.
Residential address Proof of applicant / proprietor/ partners/ Directors
/guarantors(Any one of below)
a. Passport
b. Voters Identity Card (only if it contains present address)
c. Electricity Bill (Latest-not more than 2 months old )
d. Telephone Bill (Latest) from any telephone service providers / mobile service
providers (post paid) not more than 2 months old
e. Aadhar Card with current address.
f. Driving License.
g. Income Tax / Wealth Tax Assessment order with address

6.

Financials (wherever applicable) - Last two years, Estimated for current year &
Projected for 2 years.
Declarations on annual sales supported by Returns/Assessment on Sales Tax,
Income Tax etc.
Audited balance sheet need to be submitted by traders having total
sales, turnover or gross receipt in business for the previous year
relevant to the assessment year exceeds Rs.1 Crore (from the
assessment year 2013-14).
In order to undertake Credit Rating in CRISIL module for loans above
Rs.200/- Lacs, all necessary financial papers to be submitted.

7.
8.
9.
10.
11.
12.
13.
14.

CMA Data- for Limit above Rs.200/- Lacs.

Property papers (complete 30 years chain)
Copy of VAT registration
VAT returns- Last Year & Current months.
Statement of Accounts for last 6 months
Month wise sale & purchase on letter pad
Provisional Balance Sheet (case to case basis)
Brief profile of applicant/Proprietor/Partners/Directors,
Company/firm etc.

Guarantors

and

Page | 24

Annexure-2: CREDIT RATING MODEL FOR BARODA TRADERS LOAN UPTO Rs.200
Lacs (BTL MODEL UNDER RETAIL RATING MODELS)
Summary of Various parameters allocated marks and justification:
S. No.
Parameter
Max. marks
1
Compliance of Basic Business Requirements
15
2
Business Performance
20
3
Financial Ratios
15
4
Conduct of Account (with our /Other bank)
30
5
Adequacy and nature of securities
20
6
Total Marks
100
7
Bonus Marks
8
7
Negative Marks
(-)5
8
Cut Off Marks for considering the proposal
Minimum 50%
9
Rating upto Investment Grade
BTL-6
Justification for considering the parameters and allocation of marks:
Compliance of basic business requirements: Due weight has been given for Required
Licenses and other statutory requirements, location of shop and competitions and experience
/market reputation of the entrepreneur as well.
Business Performance: Good performance of sales, earning profit and ploughing back the
profits into business for increasing net worth are the basic indicators of a good trading unit
which is the target point of BTL hence due importance is given in the rating system for
achievement of projected sales and plough back of profits.
Financial Ratios: Allocation of marks on the basis of financial ratios has been done as per
Retail Loan policy under Domestic Loan Policy 2009 and Draft Loan Policy 2012.
Conduct of Account: Timely repayment of installment /interest is an indication of good
health of account. Therefore, marks have been assigned depending upon the period during
which obligation is met. Another important aspect of discipline in the conduct of account is
routing of sale proceeds through the account. Accordingly marks are assigned for better
discipline in the account.
Adequacy and nature of securities. : Baroda Traders loans are basically advance against
the mortgages with certain limitations on eligible limits depending on the sales turnover.
Hence adequacy and nature of collateral securities have to play a vital role in securing the
advance. Self occupied residential properties are the most valuable assets for any person and
he takes utmost care to preserve the same. Accordingly maximum marks are assigned for self
occupied residential properties and similarly minimum marks are assigned for open plot of
land.
Bonus marks: Bonus marks to the maximum of 8 ( 2 for each parameter) have been
assigned for offering liquid securities, continuous increase in sales , TNW and for units older
than 5 years old.
Negative Marks: Deviation on any parameter of a structured product make the proposal
more risk prone , hence minus 5 marks have been assigned if any deviation is sought /
considered in any retail loan proposal.

Page | 25

BTL MODEL- Credit Rating Scoring Sheet on various parameters:

I
a
b
c

II
1.
a
b
c
d
2

Compliance Basic Business Requirements

Required licenses and permission obtained
(If not required- parameter will not be applicable)
Experience and market reputation of entrepreneur
(If experienced more than 3 yrs- full marks otherwise to
be reduced accordingly)
Present Business /Activity Outlook
( Marks to be awarded as per prudence of the appraising
/sanctioning authority)
Business Performance
Achievement of Projected Sales Turnover
If achieved 100% of target
Negative Variance within 10% below accepted level
Negative Variance above 10% but below 20%
Negative Variance above 20%

Max
Marks
15
5
5
5

20
10
10
8
5
0

a
b
c

Achievement of Projected PAT in terms

percentage to net sales
Achievement as projected
Achievement upto 10% negative variance
Achievement beyond 10% negative variance

3
a
b
c
d
e

Increase in Tangible Net Worth

If PAT ploughed back 100%
50% to 99%
25% to 49%
Below 25%
No Increase /Reduction

5
5
3
1
0
(-) 5

1
a
b
c
d
e

RATIOS
Current Ratio
1.33 and above
Below 1.33 and upto 1.20
Below 1.20 and upto 1.10
Below 1.10 and upto 1.00
Below 1.00

15
5
5
3
1
0
(-) 5

2
a
b
c
d

D E Ratio
3.00 and below
Above 3.00 and upto 5.00
Above 5.00 and upto 6.00
Above 6.00

10
10
4
0
(-) 4

III

Marks
awarded

of

5
5
3
0

Page | 26

IV

Conduct of the Account (with our Bank /other

bank)
Repayment obligation /Timely Repayment
Repayment within 7 days
Repayment within 15 days
Repayment with in 1 month
Repayment beyond 2 months

30

10

a
b
c
d

Operation in the Account (with our bank /other

bank) Routing of sale proceeds
Entire sale proceeds routed through A/c
Sale proceeds partially routed ( Equal or above 75%)
Sale proceeds routed below 75% and upto 50%
Sale Proceeds routed below 50%

3
a

Discipline in the Account (Our Bank/Other bank)

Whether cheques are returned for financial reasons

Account remained in excess of limit more than 4

occasions

1.
a
b
c
d
2

V
1
a
b
c
2
a
b
c
d

a
b
c
d
VII

10
5
0
-5
10
If yes 0,
if no 5
If yes 0,
if no 5

Adequacy and Nature of Security

Adequacy of coverage
If coverage is 200% or above
If coverage is above 167% and upto 200%
If coverage is below 167% ( After taking Deviation)

20
10
10
8
5

Nature of Collateral Security

Offered security is Residential building and self occupied
/ liquid security
Offered security is Residential building but rented
Offered security is commercial property
If offered property is a plot of land

10
10

TOTAL MARKS
VI

10
10
8
5
0

8
6
0
100

Bonus Marks To a maximum of 8

Liquid security available 25% or above of the loan
amount
Consistent growth in sales for 3 years by more than 15%
Continuous plough back of PAT (100%) for last 3 years
Business Unit is established for more than 5 Years.

8
2

Negative Marks
If any deviation is proposed/considered for the proposal
including concession in Interest Rate /Processing Charge

(-) 5
5

Marks Obtained out of Total

100

2
2
2

Page | 27

S No.
1
2
3
4

Score

% Score

Grade
Investment
/Noninvestment

Rating
(BTL 1 to BTL 10)

Total Marks scored .

Out of total score of .
% Score
BTL Rating as per parameters
given below

Grading and cut-off score:

S
No.

Score Awarded

Rating

Grade

Risk Perception

More than 95 %

BTL -1

Investment Grade

Low Risk

Above 90% and upto 95%

BTL-2

Investment Grade

Modest Risk

Above 85% and upto 90%

BTL -3

Investment Grade

Satisfactory risk

Above 80 %and upto 85%

BTL- 4

Investment Grade

Fair Risk

Above 70% and upto 80%

BTL-5

Investment Grade

Acceptable Risk

50% and upto 70%

BTL-6

Investment Grade

Hurdle Rate

CUT OFF MARKS 50%

6

40% and above to less than 50%

BTL-7

Non Investment Grade

Caution List

35% and above to less than 40%

BTL-8

Non Investment Grade

Off Credit

30% and above to less than 35%

BTL-9

Non Investment Grade

Off Credit

Less than 30%

BTL-10

Non Investment Grade

Off Credit

Page | 28

Annexure 3:

Format for site verification of property mortgaged to Bank.

(To be submitted along with deviation proposals)
Branch: ____________________

Type of Loan:

A/c.No.________________
Limit Sanctioned: Rs._______Lac.

Value as per Record: Rs._______Lac

Name of the borrower: __________________________________________________________

_____________________________________________________________________________
Address as per records: _________________________________________________________
_____________________________________________________________________________
Present address of the Borrower/s:
_____________________________________________________________________________
Sr.No.
1.

Particulars

Details/Response

Detailed address of property with boundaries

and landmark.

2.

Type of property i.e. Open plot, Residential

house, Commercial, Factory, Go down

Date of acquisition of property and Registration

value of the same

4.

Type of Construction(semi finished/under

construction /stage of completion) and other
description of property

5.

How property is in use i.e. self occupied, rented

out, leased.

6.

In case, not self occupied, details of the

occupant/s (with period of occupancy), rent
paid/leased amount and the modus of payment.

7.

Detail of chain of valuation of the property :

Date /Amount /Valuer

8.

Dispute in regard to payment of rent/lease

amount , if any

9.

Any attachment notice, Recovery Notice

received from municipal/Revenue/State Govt./
Court/Bank/Financial Institution

10.

12.

Date:

In whose name, the electricity, water,

telephone, municipal taxes/bills are being
received
Any other Information e.g. for deviation in age
relaxation, names of legal heir with age must
be stated.

(Signature)
(Name of Officer)
EC No: ________

Page | 29

Annexure -4 (a)
FRAUD PREVENTION CHECKLIST TO BE KEPT WITH THE LOAN DOCUMENTS
(Pre sanction Stage)
Following information to be verified by the Branch head
Name of Branch .
Name of Account .
S. No.

Guidelines

Compliance

KYC Compliance

Details of the
Document and Date
of verification

1.1
1.2
1.3
2
2.1
2.2

Address of Borrowers and Guarantors verified

Identity of the Borrower /Guarantor verified
Occupation and address of working place verified
Pre-Sanction Inspection
Date of Pre sanction Inspection
Name of Officer who carried out Pre Sanction Inspection
and the date
Whether Pre-Sanction Inspection Report kept on record
Whether CIBIL verification carried out
Whether verified from ASCROM Report
Whether Credit rating done and the score is above the cut
off point.
Verification of ITR/ Form No. 16/ Salary Slips
ITR Verified from IT Deptt on, (date)
Form No. 16 / Salary Slip verified from the employers
record (Date of verification and name of officer)
Verification of Banking Relationship
Existing Loan Accounts of the borrower with our Bank
/other Banks examined (Yes /No)
Statement of Accounts of other Banks obtained and
examined and nothing adverse found (Yes/No)
Valuation Report of the Property Offered as security
obtained and the same is not more than 3 years old
and there is no abnormal increase in value during
last 3 years. Please Give Date of Valuation and value
of property.
Legal Opinion and NEC for creation of mortgage is
obtained (Yes/No)
If yes
Whether Legal Opinion is in prescribed format also give
the date of opinion and NEC
Whether all the observations /suggestion of advocate are
complied with
Whether Deviations if any have been approved by
the competent authority
Whether detailed Sanction Letter Issued providing
the information about all type of Charges e.g
Processing Charges, Review Charges, LAD Charges,
etc.
Whether terms of sanction have been accepted by the
borrower and guarantor both

2.3
2.4
2.5
2.6
3
3.1
3.2
4
4.1
4.2
5

6
6.1
6.2
7
8

8.1

Comments of Branch
Head
Confirmed or any other
comment

We confirm having verified the above information.

(Signature of Branch Head)
Place
Date:

Page | 30

Annexure -4 (b)
FRAUD PREVENTION CHECKLIST TO BE KEPT WITH LOAN DOCUMENTS
(Post Sanction stage)
Following information to be verified by the Branch head
Name of Branch
Name of Account..
S.
No.
1

1.1

1.2
1.3

1.4
2
2.1
2.2
2.3

2.4
3
3.1
3.2
3.3

Guidelines

Compliance

Comments of Branch
Head

All the Documents have been executed as per

terms of sanction
(Date and name of the
Officer in whose presence the documents are
executed)
Whether proper Mortgage has been created as per
terms of sanction along with complete chain of title
deeds and relevant documents as per opinion of
advocate.
Whether a notice of creation of mortgage has been
sent to Sub-Registrar/Talati/ Tehsildar /Revenue
Authorities for noting Banks lien over the property.
Whether Documents have been vetted by Legal
Advisor other than who has given NEC (or the Zonal
Legal Cell as the case may be (date of vetting)
All the observation made in document verification
report have been complied with (Yes /no)
Disbursement of Loan
Whether pre-disbursement inspection carried out
and authority for disbursement from sanctioning
authority obtained
Whether disbursement of loan is made directly to
the Builder/Supplier of good
Disbursement is made by DD/BC mentioning his
Bank account details after verifications of the
credentials of the Builder /seller/Dealer of the goods
to be supplied.
Duly acknowledged Receipt of the payment made to
builder/seller/ dealer is received and kept on record.
Post Disbursement Verification:
Name of Officer carried our Post Disbursement
Inspection/Asset Verification and Date of verification
Whether any adverse feature observed, if yes
whether necessary steps initiated.
Whether Insurance cover for securities obtained

We confirm having verified the above information.

(Signature of Branch Head)
Place
Date:

Page | 31

Annexure-5: Format of letter to Advocate for legal opinion

BANK OF BARODA
. (Branch Name)
(on letter head of branch)

(Name of the Panel Advocate)

.

(Address)
Dear Sir,
Re:

Your opinion report on the property situated at . belonging

to for creation of equitable mortgage to secure credit
facilities to be sanctioned to

We are considering following credit facilities to Mr..

Nature of facility

Amount
(Rs.)

Purpose

To secure the above credit facilities, equitable mortgage of the property situated at
. belonging to has been offered.
We are
sending the documents of the property with this letter and shall thank you to please submit
your complete Opinion Report in respect of the clear and marketable title to the property,
certifying non-encumbrances of the property.
Your report should be comprehensive and must cover the following points:
1

Name of Account & Proposed facility

Description & Area of property proposed to be mortgaged with boundaries (a.Give the
specific number & address of plot, house, bldg., flat, shop, etc. b.State specifically
whether property is in agricultural, non-agricultural, commercial, residential or industrial,
area.)

Name of mortgagor & his Status in the A/c (Whether Sole proprietor, Partner, Director,
Karta, Trustee, Agent or Guarantor or Co-borrower)

Whether the mortgagor has sufficient title and capacity to contract for creation of
mortgage (Not a minor, Lunatic or undischarged insolvent, etc.)

Nature of mortgagor's right or title in the Property(Whether lease hold, free hold, coowner, or joint owner or any other type-state specifically) and how it is derived (whether

Page | 32

self acquired, ancestral/ inheritance or by succession or otherwise).

6

Whether Mortgagor is in exclusive possession of property proposed to be mortgaged

Documents studied/scrutinized (In chronological order)

Sr.
No

Type/Nature
Document

Tracing of title & Chain of title in favour of Mr./Ms.____________ proposed

mortgagor(here set out chain of title in detail & in chronology starting from earliest
document available. The Nature of document/Deed conveying the title should be
mentioned along with the type of right it creates) together with names and descriptions
of Parties to the documents

Whether title is clear and property is free from any encumbrance (enclose relevant
receipts of search)
(a)
No of Years (30 years normally) for which search made in Subregistrar's/Registrar's
Office
(b)
If Name is mutated in municipal records and
(c)
If Name is shown in Revenue/ Land records

10

Whether title to properties is clear, unambiguous, marketable & property is saleable

11

Whether there is any Bar/ restriction for creation of equitable mortgage under any Act,
state law or rule/notification(like Ceiling Act, Land Acquisition Act, State Coop. Societies
Act, Societies Registration Act or Apartments/Flat Ownership Act or Income Tax Act)

12

Whether any permission /consent/ no objection is required & if so, it is obtained (State
the letter no. and the Authority / Statutory Body/Court concerned)

13

Additional documents required/ formalities to be completed by the proposed

mortgagor(State specifically in case of flats / properties in coop. societies whether
allotment letter, possession letter, share certificate, affidavit, power of attorney, etc is
required)

14

List out the Title Deeds to be deposited to create mortgage by Deposit of Title Deeds in
favour of Bank by abovesaid mortgager Mr./Ms.______________

15

Whether all original deeds are available and scrutinised Deeds are duly
executed/stamped and registered. There is no doubt/ suspicion as to their genuineness
or existence

of Date
Execution

of No.
&
Date
of Parties
Registration/Lien
in
revenue records/ builder's
records/ society's records

Page | 33

16

Final certificate/opinion

Please also note the following:

(1)
(2)
(3)
(4)

The above are the minimum points/ broad heads to be covered / elaborated/ discussed
in your report.
These points/headings are indicative and not exhaustive, depending upon the situation
and circumstances.
The opinion-cum-report has to be given by you personally on your letter head under
your signature.
You are required to submit the opinion/ report only after getting all clarifications and
required documents, after thorough perusal and when fully satisfied.

Yours faithfully,

..
(SMS Head / Branch Manager)

Page | 34

APPLICATION FORM BARODA TRADERS LOAN

Photo

The Chief/Sr./Branch Manager

Bank of Baroda
...

I/We hereby apply you for the working capital limit by way of Overdraft/ Demand Loan limit of Rs.
___________________________ and append below the related information:

Name of Applicant/ Firm

Place of Business
Residence Address
(Prop/ Partner)
Godown Address
If any
Telephone No.

Res:.

Off.

Mobile:

Date of Establishment
Line of Activity
Present Bankers/Branch

Nature of facility enjoyed

Amount

Banking with Br. Since :

Name of Proprietor/ Partners

Age

Educational Qualification

Experience in line of activity

Whether Business Premises are Own/

Rented/ Leased
Will the applicant be able to route his
trade proceeds through the Bank ?
Goods/ Commodities traded
Sources/ Major Suppliers in
Commodities Traded

the 1.
2.
3.
Page | 35

Number of Firms Engaged in Similar 1.

Activity in same locality
2.
3.
ASSOCIATE CONCERNS :
Name of the Firms

Business Activity

Bankers

Credit Facility, if any

BUSINESS PERFORMANCE :
Summary of Performance

Actuals of Previous three years

31.03.

31.03.

Estimated for Projections

current year
31.03

31.03

Total Turnover/ Sales

Total Purchase
Net Profit
Current Year Sales for __________________ Completed months

`.

How is the anticipated turnover considered

feasible of achievement ?
State./ Central Sales Tax Registration No. State Sales Tax
____________ (Enclosed latest Sales Tax /
31.03.
Income tax Assessment Order)

Central Sales Tax

31.03

31.03

31.03

3. SECURITY
A) Details of Immovable Property :
Property standing in the name of
Location of Property :

House No.

Street

Town

Taluka

District
State
Value of Property as per valuation report dated _______________
`. ______________
B) Details of Other Collateral Securities :
Description

Value

C . Total advance value of the security

Page | 36

Working Capital Requirement:

Nature of Facility

Limit Required

Nature of Security

Value of Security

Other Remarks :

Place:
Date :
Signature of the Applicant

Page | 37

APPRAISAL NOTE BARODA TRADERS LOAN

BRANCH :_____________________________
NAME OF THE BORROWER/ APPLICANT : __________________________________________________
NAME OF BORROWERS

WORTH

NAME OF BORROWERS

WORTH

IN CASE OF FIRM ALREADY IN OUR BOOKS :

Position of account as on:_____________________
Facility

Limit

Advance
Security

Value

of Outstanding

Comment
on
the
Conduct of Accounts
Summary of
Performance

Actuals of Previous two years

31.03____

31.03.____

Estimated
current year
31.03____

for Projections
31.03.____

Total Turnover/ Sales

Total Purchase
Net Profit
Current Year Sales for ________ completed months

`.

Sales Tax Assessment Order dated _______ for the year _____ `.
Sales Tax Return dated __________ the year _____________

`.

Is the anticipated turnover reasonable, keeping in view the applicant's experience/ past
performance and the market potential in the locality ?
SECURITY :
Description

Values

Value of property as per valuation report dated ____________

Legal Opinion received on
INSPECTION OF SHOP
Date of visit to the shop
Comments of Inspecting Official
Page | 38

COMPUTATION OF LIMIT
1) Last Year's Actual Sales
2) Current year's Sales during the completed months
3) Current year Annualised Sales
= Completed Months Sales 12
Completed Months
4) Projected Sales
5) Accepted Projected Sales
6) Permissible Limit (20% of accepted projected sales)
7) Advance Value of the Collateral Security
8) Sanctioned Limit (6) or (7) whichever is less
Particulars of Limit
Nature of Facility

Nature
Security

of Value of Security Limit (`.)

(`.)

Sanctioned/ Recommended
Repayment Schedule
Major terms & conditions

Sanctioned / Recommended

Branch Manager/Sr. Branch Manager/ Chief Manager

Date:
_______________________________________________________________________________________

Page | 39

Pre Sanction Inspection Report Baroda Traders Loan

Branch :______________________________________
1.

Name of the Applicant

2.

Business Activity

3.

Business address

4.

Business premises is owned/rented

5.

Date of visit of shop

6.

Comments on situation of shop and business perspective and reputation in the market:

7.

Verification of various licences and registrations

:
:

Licence under Shop Act

Certificate of Central Sales Tax

Certificate of State Sales Tax

Random verification of purchase bills :

Random verification of sales bills/invoices:
8. Residential position of the proprietor/ partners
ii) Comments on the antecedents, business dealings and reputation of the proprietor/ partners:

iii) Comments on the antecedents, business dealings and reputation of the guarantor/s:

11. Verification of the immovable property being offered as security

(i) Situation & Surroundings
North
:
South
:
East
:
West
:
(ii) Physical condition :
(iii) Age
:
(iv) Possession
:
(v) Electricity connection in the name of :
(vi) Water connection in the name of
:
Page | 40

(vii) Views on the valuation of the property after making discreet enquiries about the realizable value of
property after taking into account factors like location, occupation.
(state whether value is over stated)

12. Other observation/ remarks and recommendations:

Place:
Date:

SIGNATURE
Name of the officer:

Page | 41

BRANCH: _______________________________________________

F - 135

PARTICULARS TO BE SUPPLIED BY APPLICANT/Co-APPLICANT/ Directors/ppartners/ Prop. , Gurantor FOR ADVANCES

I give below the particulars of my self, my family and my Assessts & Liabilities as at ___________________.
1. Name in Full: _________________________________________________________________________
2. Date of Birth:______________________________ & Age : _____________
3. Fathers/ Husbands Name : ______________________________________________________________.
4. Residential Address :
PERMANENT
__________________________________

PRESENT
________________________________________

__________________________________

________________________________________

__________________________________

________________________________________

__________________Pin:_____________

________________________Pin:_____________

5. Telephone Numbers.

Office/Shop : __________________ Residence: ____________________

Mobile

: _______________________________________

6. Occupation/ Line of Business

: _______________________________________

A. If in service
Name of employer and Address

:
: _______________________________________
_______________________________________
_______________________________________
: _______________________________________

Designation
B. If in Business/Professional
i) Name/s of the firm/company
and its Address
ii) Line/s of activities
iii) Since when established
iv) In which capacity he/she is
representing
7. Annual Income
8. PAN (if an Income Tax Assesses)
9. Details of Assets

:
: _______________________________________
_______________________________________
_______________________________________
: _______________________________________
: _______________________________________
: _______________________________________
: Rs.____________________________________
: _______________________________________
:

9.1 Details of immovable properties (held in own name / joint name):

A. Nature of properties (Please tick which ever applicable):
i) Plot of land

: _______________________________________

ii) Agriculture Land

: _______________________________________

iii) House / Godowns

: _______________________________________

iv) Others

: _______________________________________

Page | 42

B. Location : ________________________ Survey / House No: ____________________

Area / Locality : __________________________________________________________
Village / Town :_________________________ District : __________________________
C. Property in whose name?

: _______________________________________

D. Cost (at the time of purchase)

: Rs. ____________________________________

E. Present estimated market value of the property/ies : Rs.________________________

F. Whether encumbered/un-encumbered/partially : ____________________________
encumbered/un-encumbered/partially
: ____________________________
with whom. Consideration and major terms
and conditions.
9.2 Details of movable properties in my name :
A. LIC policies
Policy No.
Of Policy
(1)

Date of issuance
(Rs.)
(2)

Sum assured
(3)

Branch Name
(in Rs.)
(4)

Annual Premium
up to what per.
(5)

Premium Pai

Total Amount
Rs. (Face Value)

Whether fully
Paid (yes/No)

Cur. Market
Value Rs.

(6)

B. Shares/ Debentures etc.

Name of
Company

Total No. of Shares

Shares held

Certificate No.
A/C No.

C. Term Deposits
FDR/RD/YSJY
A/c No.

Date

Fvg.

Amount
Rs.

Name of Bank
Branch

Due date

Maturity
Value Rs.

Amount
Rs.

Due
Date

Maturiy Value
Rs.

D. Investment in Govt. Securities like Bonds/NSC etc.

Bond/Certificate No.

Date of Purchase

Issuing Office/Post
Office Add.(includingMutual Funds)

9.3 Details like Reg. No. type and value of vehicle/s

owned by me.

: ____________________________________
____________________________________

9.4 Capital investment in business. Name of Firm/

Company (As on latest sheet date)

: ____________________________________

9.5 Full details of other investments if any

(i.e. Jewellery, Investment in other firm etc.)

: ____________________________________
____________________________________

9.6 Total of all assets (9.1 to 9.5)

: Rs._________________________________
Page | 43

10. Details of Loans in individual name/firms Name /Companys Name :

A. Name/s of the Bank /other Institution and its branch

: ____________________________________

B. Purpose and amount of Loan availed

: ____________________________________

C. Security & repayment schedule/rate of interest

: ____________________________________

D. Present balance outstanding

: ____________________________________

E. Liabilities other than to bank and Financial Institution

: ____________________________________

11. Other Details

Details of personal guarantee given for any person/firm
: ___________________________________
If so furnish details (i.e. Name of Bank /Institution, on
whose behalf amount of guarantee present status of a/c etc.)
12. (A) Particulars of Legal Heirs
Sr. No
(1)

Name
(2)

:
Relationship
(3)

Age
(4)

Present Address
(5)

(B) Nomination particulars

Sr.No.
(1)

Description of Asset Bank/Organisation

(Bank Dep., Co. Dep.,
Terminal Benefits etc.)
(2)

Accont/certi- Amount (at

ficate No.
(3)

(4)

present /at
maturity)
(5)

In support of my above declaration, I enclose

1. Balance sheet, Profit and Loss Accounts, Trading Account, Capital Account (audited/unaudited).
2. Copy of employment certificated with details of salary drawn.
3. Copies of agreement/revenue records/society certificates in respect of land/ building/flat owned by me.
4. Copies of Income Tax/Wealth tax returns/ Assessment Order.
13. I declare that.

I am/I am not (tick as applicable) a Director in ____/any Bank . There is no litigation against me or the firm/ Co.
in which I am the proprietor/ a partner/ a Director.
The name of the firm /Co. or the name of the partners/Proprietor/Director of the firm/ Co. is not the caution list
of RBI/ECGC.
The proprietor/partners/directors of the firm/Co. is/are not the Directors in any Co-operative Bank.
I also declare that the above information is complete, true and correct.
Signature of the Applicant/Co-Applicant /Guarantor : ___________________________

Encls:

Place: _____________________
Date: ______________________
Page | 44