COMMODITY BACKED WAREHOUSE RECEIPT FINANCING

purpose

To finance traders/owners of goods against warehouse receipts of warehouses managed by Central Warehousing Corporations/ State Warehousing Corporation and warehouse accredited by MCX by way of Demand Loan/Cash Credit.

Eligibility

Any trader dealing in commodities.

Eligible Amount of Finance

Demand Loan
75 % of the value of the warehouse receipt, valued at the market value OR 80% of the minimum support price declared by State/Central Government, whichever is lower.

Cash Credit
70 % of the value of the warehouse receipt, valued at the market value OR 75% of the minimum support price declared by State/Central Government, whichever is lower.

Processing charges

Cash Credit
Rs.300/- per lac for the facility sanctioned

Demand Loan
Nil where loan is sanctioned and disbursed. Rs. 300 per lac in case the loan is sanctioned but the borrower does not avail.

margin

Demand Loan
25% (minimum) of the value of the warehouse receipt, valued at the market value OR 20% (minimum) of the minimum support price declared by State/Central Government, whichever is higher

Cash Credit
30% (minimum) of the value of the warehouse receipt, valued at the market value OR 25% (minimum) of the minimum support price declared by State/Central Government, whichever is higher.

Insurance

Comprehensive Insurance cost to be borne by the warehouse receipt owner.

security

Primary Charge over warehouse receipt (resulting in charge over underlying goods), with lien marked in favour of the bank. Collateral Personal guarantee of partners or directors as the case may be.

repayment

Demand Loan
The loan should be liquidated as and when the produce is sold during the interim period not exceeding 12 months.
Cash Credit

Repayable on demand.
To be brought to credit balance and DP made Nil/reduced when the quality certificate expires.

others

• The Warehouse receipt should be duly marked lien in favour of the company
• The Branch should verify the authenticity of the warehouse receipt and get its lien noted with the warehouse before disbursal of the demand loan/ CC facility.
• The margin shall be topped up on a fortnightly basis. However, it should be topped up immediately in case the price of commodity moves by more than 10%, in opposite direction, since last top up.
• CC Limits and operating account will be different for different commodities handled by the same trader/customer. Interchangeability in limits can be offered, if required.