Raw Material Assistance Scheme aims at helping MSMEs by way of financing the purchase of Raw Material (both indigenous & imported). This gives an opportunity to MSMEs to focus better on manufacturing quality products.
Benefits of the Scheme
- Financial Assistance for procurement of Raw Material upto 90 days.
- MSMEs helped to avail Economics of Purchases like bulk purchase; cash discount etc
- NSIC takes care of all the procedures, documentation & issue of Letter of credit in case of imports.
How to Apply
The Entrepreneurs are required to apply for Raw Material Assistance only on the prescribed application forms. The application forms downloaded from the link given below may be filled and submitted to the concerned Branch Office. The blank forms are also available free of charge from the Branch offices.
- Duly filled application form is to be submitted along with the Application
- Preliminary appraisal and Unit inspection is carried out by NSIC.
- Sanction of Limit to the Unit.
- Signing of agreement between NSIC and Unit.
- Disbursement of assistance to the unit.
Terms and Conditions
- Security in the form of Bank Guarantee from Approved/Nationalised Banks.
- The rate of interest would be as under:
Assistance against the security of BG :
||Effective Rate of Interest(% per Annum)
|A. Entire Outstanding Dues within 90 Days
|(i) Units (MSEs) having valid MSE 1 rating
|(ii) Units (MSEs) having valid MSE 2 rating
|(iii) Other units
|B. Any Outstanding due more than 90 days and not beyond 270 days
|C. Any Outstanding due more than 270 days
Additional rate of interest on delayed payment ( beyond 90 days) , over and above the normal rate of interest, would be as under :
|a)In case entire outstanding is within 270 days
||1% for every cycle of 90 days on the principal outstanding dues
|b) In case any outstanding is more than 270 days
||1.25% for every cycle of 90 days
Processing Fee :
||SMALL AND MEDIUM
|On new sanctions
Documents to be enclosed with application form
- A passport size photograph of each of the Proprietor / Directors / Partners / Society office bearers.
- Self-attested photocopy of :
- GST Registration Certificate ,
- PAN Card of the Firm / Proprietor (in case of Proprietorship concern).
- Copy of latest ITR of the Company/Firm /Directors/Partners/Proprietor
- Self-attested statement of personal assets and liabilities along with the residential address of Proprietor/Directors/Partners/Society office bearers.
- Copy of Memorandum & Articles of Association along with list of Directors in case of Pvt. Ltd. / Ltd. Co.
Copy of Partnership Deed duly notarized in case of Partnership concern.
A copy of Bye Laws & charter of society along with a list of governing body / executive members in case of society.
- A copy of Board Resolution in case of Pvt./Public Ltd. Co., Power of Attorney in case of partnership firm & a Governing Body Resolution in case of Society authorizing the signatory to sign and to deal with NSIC in respect of financial assistance required, for and on behalf of the applicant unit.
- Specimen signatures of authorized signatory attested by bank.
- Copy of sanction letter for credit limit sanctioned by the FIs/ banks.
- Audited/Provisional financial statements of the unit:
- Last year Audited financial statements.
- Provisional current year financial statements.
- For startup MSME unit- Current year estimates financial statements duly certified by its Auditors or Chartered accountants
- Bank statement of the unit for the last six months.
- Copy of the latest Electricity Bill.
- Conduct Report of Account of the unit with Banks (Other than BG issuing Bank) and Financial Institutions
- Certificate / Undertaking from the borrower that their name(s), name of the company/its owners/its associates /its sister concern/its members in any way fall in the list of CIBIL/ RBI Defaulters list or any sort of case is there against them.
- Copy of orders in hand, in case of enhancement of limit beyond five crore
Documents Required for Renewal of Cases
- Unit’s request letter for renewal of limit and declaration that there is no change in constitution, promoters & address.
- In case there is any change in constitution, promoters & address, relevant supporting documents to be obtained.
- Copy of latest and valid Bank Sanction letter.
- In case renewal is due after the due date of filing of income tax return, copy of Audited Annual Accounts for the last financial year. In case, audited annual accounts are not finalized, self-attested declaration of financial parameters of last financial year as mentioned at S.No.19 of Appraisal form along with latest available Audited Annual Accounts.
- Projected /Estimated annual accounts of the Current Financial Year or self-attested financial parameters as mentioned at S.No.19 of the appraisal note.
Documents needed after Sanctioning of limit and before disbursement
- Agreement for Raw Material Assistance
- Material Receipt as per Format.
- Demand Promissory Note as per Format & duly signed.
- Letter of Continuity as per Format.
- Bills / Invoices for release of payment in favour of supplier.
- Bank Guarantee as per format and its confirmation from Bank.
|Frequently Asked Questions (FAQs): Raw Material Assistance
|Frequently Asked Questions (FAQs): Raw Material Distribution