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Bank of Baroda, for rural India, with rural India.

Financing under PM Formalization of Micro Food Processing Scheme

  • Benefits
  • Features
  • Eligibility Criteria
  • Document Required
  • Fees & Charges
  • Most Important Terms and Conditions (MITC)

Financing under PM Formalization of Micro Food Processing Scheme : Benefits

Support to Individual Micro Enterprises: credit-linked capital subsidy @35% of the eligible project cost with a maximum ceiling of Rs.10.0 lakh per unit.

  1. Support to Group Category:
    • FPOs and Producer Cooperatives would be provided Grant @35% with credit linkage (As per guidelines of PM Formalization of Micro Food Processing Enterprises Scheme (PM FME Scheme)
  2. Support to Self Help Groups (SHGs) as follows:
    • Seed capital @ Rs. 40,000/- per member of SHG for working capital and purchase of small tools.
    • Support to individual SHG member as a single food processing unit with credit linked grant @35% with maximum amount being Rs 10 lakh.
    • Support for capital investment at federation of SHG level, with credit linked grant @35%. Maximum limit of grant in such cases would be as prescribed by respective state.
  3. Need based funding requirement of project/borrower
  4. Facilities can be availed as TL, CC, BG, LC, BP, BD, Export Credit for pre shipment and post shipment
  5. Repo Rate and Credit Rating linked ROI
  6. Low Margin: Minimum 10%
  7. Benefit of Credit Guarantee Coverage

Financing under PM Formalization of Micro Food Processing Scheme : Features

  • Finance for upgradation of existing Micro Food Processing enterprises under PM Formalization of Micro Food Processing Enterprises Scheme
  • Increased access to credit by existing micro food processing entrepreneurs, FPOs, Self Help Groups (SHGs) and co-operatives
  • Integration with organised supply chain by strengthening branding and marketing
  • Increased access to common services like common processing facility, laboratories, and storage, packaging, marketing and incubation services
  • Strengthening of institutions, research and training in the food processing sector
  • Increased access for the enterprises, to professional and technical support

Financing under PM Formalization of Micro Food Processing Scheme : Eligibility Criteria

Eligibility criteria for Individual Micro Enterprises:
  • Existing micro food processing units in operation
  • The enterprise should be unincorporated and should employ less than 10 workers.
  • Ownership status could be Proprietary /Partnership Firm
  • The applicant should be above 18 years of age and should possess at least VIII standard pass educational qualification

Eligibility Criteria for Co-operatives/FPOs
  • FPO should have minimum turnover of Rs 1 Crore and preferable engaged in processing of ODOP produce.
  • The members should have sufficient knowledge and experience for a minimum of 3 years period

Eligibility Criteria for Seed Capital for SHGs
  • Only SHG members that are presently engaged in food processing are eligible

Eligibility Criteria for Credit Linked Grant for capital investment for SHGs
  • The SHGs should have sufficient own funds for meeting 10% of the project cost and 20% margin money for working capital or sanction of the same as a grant from state Government

Financing under PM Formalization of Micro Food Processing Scheme : Document Required

  • KYC Documents (AADHAR, Voter ID, PAN Card, Driving License etc.)
  • Passport Size photo
  • Land Record
  • Quotation/Invoice (if available)
  • Project Report (if available)
  • IT Returns (if available)

Financing under PM Formalization of Micro Food Processing Scheme : Fees & Charges

Processing Charges:

For Working Capital (Fresh/Review)

Fund Based:

  • Above Rs. 3 lacs to Rs, 10 Lacs - Rs.250 per lac or part thereof +GST
  • Above Rs. 10.00 lacs - Rs. 350/- per lac or part thereof +GST

Non Fund Based:

  • 50% of charges applicable for Fund Based Limit

For Term Loan (Fresh):

  • Above Rs. 3.00 lacs - DL/TL 1% of the limit sanctioned + GST

For Term Loan (Review)

  • Above Rs. 3.00 lacs - Rs. 60/- per lac or part thereof +GST

Financing under PM Formalization of Micro Food Processing Scheme : Most Important Terms and Conditions (MITC)

Age Criteria For Individuals: Minimum 18 years (if the age of applicant exceeds 70 years, in such case the legal heirs to be made co borrower) For Non-Individuals – Not applicable
Quantum of Loan Need based funding to be considered looking to the requirement of the project/borrower
Nature of Facility Term loan and Working Capital in the form of Term Loan/Demand Loan/ Cash Credit/Bank Guarantee/Letter of Credit/BP/BD, Export Credit pre-shipment and post shipment.
Repayment Period Working Capital: 12 months. Term loan up to 84 months (including up to 12 months moratorium period) subject to annual review.
Security

For loans upto 1.60 Lakh

  • DP Note
  • Hypothecation of crops grown /assets to be created out of bank’s finance

For loans upto 1.60 Lakh

  • DP Note
  • Hypothecation of crops grown /assets to be created out of bank’s finance.
  • Equitable Mortgage / Registered Mortgage of land or Third Party Guarantee
Margin Minimum 10% of the project cost
Moratorium Period Maximum upto -12- months
Repayment Period -12- Months for Working Capital Upto 84 months for Term loan (including upto -12- months moratorium period) Subject to annual review
Rate of Interest
Internal Credit Rating Immovable Property security coverage (including both primary and collateral immovable properties)
Above 100% Above 75-100% 50-75% Below 50%
CR-1 to CR-3 BRLLR+SP+0.50% BRLLR+SP+ 0.65% BRLLR+SP+ 0.95% BRLLR +SP+ 1.25%
CR-4 to CR-6 BRLLR+SP+0.95% BRLLR+SP+1.25% BRLLR+SP+1.55% BRLLR +SP+ 1.80%
CR-7 & Below BRLLR +SP+3.90% BRLLR +SP+ 4.25% BRLLR +SP+ 4.75% BRLLR +SP+5.00%

Note : The Bank may use the services of agents in sales/marketing etc. of its various products

Frequently Asked Questions (FAQs)

  • What is the PMFME scheme?

    Ministry of Food Processing Industries (MOFPI), in partnership with states, has launched an all India centrally sponsored PM FME scheme for providing support in three areas – financial, technical and business. Additionally, this PM FME loan scheme allows existing micro food processing enterprises to upgrade.

  • What is the processing fee for PMFME loan?

    The processing fee of PM FME loan varies according to the working capital borrowed.
    Between Rs. 3 lakhs to 10 lakhs – Rs. 250 per lakh.
    Abover Rs. 10 lakhs – Rs. 350 per lakh.

    While applying for PM FME term loan above Rs. 3 lakhs, it is 1% of the amount sanctioned by the bank.

  • What is the maximum loan amount for PMFME scheme?

    The bank evaluates the need of the borrower and then sanctions the amount for PMFME scheme.

  • Who can apply for PM FME loan?

    Enterprises who are setting up new micro food processing plants or upgrading the existing one can apply for PM FME scheme.

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