A Term Loan is a loan granted for working capital and/or project finance to be repaid within a specific period of time with interest. The loan is repaid in a lump sum on maturity, or in periodic installments (i.e. monthly, quarterly, semi-annually, or annually), depending on the nature of the business and its cash flow. The Bank extends Short-Term Loan, Medium-Term Loan and Long-Term Loan.

Depending on the nature and cash flow of the business, the Bank may provide a maximum grace period of three months for short-term loans, two years for medium term loans, and three years for long-term loans. Grace period is a period during which the borrower is relieved from principal and interest repayments.

For project term loan request, the interest accrued during the implementation period shall be part of Bank financing, but the loan amount to be disbursed by the Bank shall be net of interest accrued during the implementation period. Otherwise, in order to consider the interest as equity contribution, the borrower shall deposit it in a blocked account before disbursement of the loan. So that the interest repayment shall be effected from the blocked account.

For any project financing the borrower shall first commit his/her/its total equity contribution to the project and it shall be verified before the first disbursement made by the Bank.

In any project financing phase-by-phase disbursement, the Customer Relationship Manager is empowered to disburse as per the terms and conditions of the credit decision. However, if there is a variation from the credit decision, the disbursement request of the customer shall be deliberated by the Credit Approving Team.

The Bank extends Short-Term Loan, Medium-Term Loan and Long-Term Loan.

Clik here to read about the Types of Term Loan.