Advertisement

Loan

Loans and Advances by the Central Government – Interest rates and other terms and conditions

Loans and Advances by the Central Government – Interest rates and other terms and conditions

F.No.5(3)-B(PD)/2016
Government of India
Ministry of Finance
Department of Economic Affairs

New Delhi, the 6th January, 2017

OFFICE MEMORANDUM

Subject:- Loans and Advances by the Central Government – Interest rates and other terms and conditions.

Reference this Ministry’s Office Memorandum F.No.5(3)-B(PD)2015 dated 3rd February, 2016 on the captioned subject.

2. The lending rates, categories and conditions prescribed in the aforesaid Office Memorandum have been reviewed. The revised rates of interest,categories and conditions as given in the Table below, would be applicable from 1st April, 2016 and till the time these are reviewed:

TABLE

Category of borrower & type of loan Interest rate per cent per annum
1. State Governments (EAP Loan): 8.00
2. Union Territory Governments (with Legislature):
(i) Loans upto 1 year and EAP loan 8.00
(ii) Other Loans 8.50
3. Industrial and Commercial Undertakings in the Public Sector and Cooperatives: Loans for implemantation of VRS in sick PSUs 10.00

The terms and condition and conditions regarding eligibility of loan would remain the same as that of last year. If any specific request comes in future from any other financial institution/CPSE/Autonomous Body/Cooperative, it would be examined by the Budget Division, DEA on merits of that case.

3. The terms, including interest rate of loans to Foreign Governments may be settled in consultation with Budget Division. Terms for on-lending of funds under externally aided projects should be in accordance with the prescribed pattern. In case, deviation is considered necessary, Budget Division should be consulted.

4. The interest rates prescribed above assume timely repayments and interest payments and hence no further rebate in rates is to be allowed for timely payments.

5. OTHER TERMS AND CONDITIONS

(a) The loan sanctioning authority should meticulously follow the instructions contained in General Financial Rules, 2005 (GFR 2005), particularly, rules framed under Chapter 9 (II-LOANS) of
GFR, 2005, while sanctioning loans to various entities as stipulated therein.
(b) The instructions issued from time to time have been reviewed and are set out in the following paragraphs for facility of reference.

6. STATE GOVERNMENTS

In the case of loans to State Governments, the arrangements for payment of annual instalment of principal and interest will be as under:-
(a) Block loans for State Plan Schemes and other Plan loans for Centrally Sponsored Schemes:- These loans when drawn in instalments, will be consolidated and deemed to have been drawn as on 1st October in each year. The maturity period of the loans sanctioned for State Plans is 20 years, repayments being made in 20 annual equal instalments together with interest on the outstanding balance commencing from the following year, subject to consolidation under the award of Twelfth Finance Commission (TFC).

However, fifty per cent of these loans will enjoy a five year initial grace period, after which repayments of these loans will be effected in 15 annual equal instalments. The amounts annually payable(by way of principal and interest) would be recovered in 10 equal monthly instalments commencing 15th June, subject to debt waiver under the award of TFC.

(b) Other Loans:- The terms of repayment of these loans will be as laid down from time to time.

7. PUBLIC SECTOR PROJECTS

(A) For new installations or expansion of existing institutions:

(a) The terms and conditions of loans should be fixed with reference to the financial picture presented in the approved Project Report. (Once the pattern is settled, there should be no change except with the specific concurrence of this Department for reasons to be stated in writing).(b) The capital requirements of a project should include adequate provisions for interest payment on borrowings during the period of construction (as specified in the Project Report). The interest on loans due during the period of construction will be allowed to be capitalised to the extent of the provisions made for this purpose in the approved Project Report. In other words, while interest on loans advanced to an undertaking during the period of construction will be notionally recovered by allowing its capitalisation, the payment of interest should effectively commence after the construction period is over.

(c) The repayment of principal should ordinarily commence one year after the project commences production, the number of instalments being determined with reference to the financial projections and repaying capacity specified in the Project Report. Requests for further moratorium will be considered only in exceptional cases where the Project Report has specified any special circumstances that may necessitate a longer period of moratorium and has indicated clearly what staggering of repayment would be needed over the necessary break period. The period of loans sanctioned against capitalised interest during the period of construction may also be on the same terms and conditions as are applicable to loans provided for financing the project costs.

(d) A suitable period of moratorium subject to a maximum of five years from the date of drawal of the loans may be allowed for the repayment of instalments of principal, having regard to the nature of the project, the stage of construction etc. The period of moratorium should not, however, extend in any case, beyond two years from the date of project going into production, or in the case of programmes of expansion, beyond two years from the date of expanded project coming into operation.

(B) For meeting working capital requirements: The undertakings are expected to obtain their cash credit requirements from the State Bank of India/Nationalised Banks by hypothecating their current assets (such as stock of stores, raw materials, finished goods, work in progress, etc.) and where the entire working capital requirements cannot be raised in this manner by seeking a guarantee from Government. Accordingly, requests from Public Sector Undertakings for funds for meeting working capital requirements should be considered only to the extent the same cannot be had from the State Bank of India/Nationalised Banks.

8. GENERAL

REPAYMENT PERIOD

(A) (i) The period for repayment of loans for all parties other than State Governments should be fixed with due regard to the purpose for which they are advanced and it should be restricted to the minimum possible. Normally, no loan should be granted for a period exceeding 10 years. Where a longer period for repayment is sought, prior concurrence of the Budget Division in this Department will be necessary for fixing the period.
(ii) The repayment of a loan should normally commence from the first anniversary date of its drawal or on expiry of the period of moratorium, as the case may be. The recovery should ordinarily be effected in annual equal instalments of principal.
(iii) The period of repayment of working capital loans should preferably be restricted to two or three years. In no case, however, the period of these loans should exceed 5 years.

(B) Moratorium:

Subject to exceptions made in respect of pubic sector projects, a suitable period of moratorium towards repayment might be agreed to in individual cases having regard to the project for which the loans are to be utilised. However, no moratorium should ordinarily be allowed in respect of interest payment on loans. Ministries/Departments may with the approval of their Financial Advisers allow moratorium on repayment of principal wherever considered necessary upto a maximum period of 2 years.

(C) (i) Repayment before due date:

Any instalment paid before its due date may be taken entirely towards the principal provided it is accompanied by payment towards interest due upto date of actual payment of instalment; if not, the amount of the instalment will first be adjusted towards the interest due for the preceding and current periods and the balance, if any, will alone be applied towards the principal. Where the payment of the instalment is in advance of the due date by 14 days or less, interest for the full period (half year or full year as the case may be) will be payable. If any State Government repays an instalment of a loan which is consolidated as on 1st October, in advance of the due date by more than 14 days the interest.

(ii) Pre-payment premium: Prepayment premium of 0.25% on the loans with residual maturity of less than 10 years and 0.50% for the loans with residual maturity of 10 years and above, shall be charged. The provision does not apply to the loans to State/UT Governments.

(D) Penalty Clause:

The loan sanctions/agreements should invariably include a penalty clause providing for levy of a penal rate of interest in the event of default in repayment of instalment(s) of principal and/or interest. The penal rate of interest should not be less than 2.50% above the normal rate of interest at which a loan is sanctioned.

(E) Defaults in repayment/interest payment:

(i) In the event of a default in repayment of loan/interest payment, the recovery of interest at penal rate may not be waived unless there are special reasons justifying a waiver. However, a decision in this regard will be taken by the Ministry of Finance (Budget Division) on the advise of Financial Adviser. Even in such cases, a minimum of 0.25% should be recovered from the defaulting party as penalty.

(ii) The penal rate of interest is chargeable on the overdue instalments of principal and/or interest from the due date of their payment to the date preceding the date of actual payment.

(iii) Whenever a fresh loan is to be sanctioned to a borrower who has earlier defaulted, the loan sanctioning authority must consider the question of recovery of defaulted dues. All releases to Public Sector Undertakings against budgeted outlays should be made only after adjusting the defaults, if any, pertaining to repayment of loans and interest. If for special and exceptional reasons such adjustments are not possible, specific orders of Secretary (Expenditure) should be obtained through Budget Division, before release of fresh loans, in relaxation of extant orders, in conformity
with this Division circular No.F.2 (190)-B(SD)/91, dated 15.10.1991.

(iv) Any defaults should ab-initio serve as a warning signal to the Ministries/ Departments for which curative action has to be taken immediately.

(v) Ministries/Departments need to critically review the financial position of the borrower, including defaulting CPSUs and wherever possible, should take immediate action to recover the money due to the Government.

(vi) In the case of defaulting CPSUs, there has to be a clear road map for restructuring of these CPSUs, as prolonged approval results in burgeoning of defaults.

(vii)Ministries/Departments are to ensure that these defaults do not become fiscally unsustainable.

(viii) Wherever Ministries/Departments are considering restructuring of a CPSU, it must be ensured that besides equity infusion, funds mobilisation, rescheduling of loans/interest payments, write off of dues, etc. should be formulated holistically. However, no request for waiver/postponement of instalments on any ground whatsoever will be accepted, except in cases of companies referred to BIFR or in respect of those companies which have incurred cash losses for last three years, in conformity with this Division circular No.F.2(165)-B(SD)/94, dated 06.10.1994.

(F) Requests for modification of terms of loans:

(i) Borrowers are required to adhere strictly to the terms settled for loans made to them and modifications of these terms in their favour can be made subsequently only for very special reasons. Requests for modification of terms may relate to increase in the period of a loan or of initial moratorium period towards repayment, or waiver of penal interest or reduction in or waiver of normal rate of interest. The procedure of dealing with requests for waiver of penal interest has already been dealt with in paragraph 8. Cases involving other modifications in repayment terms should be considered in consultation with the Budget Division in this Ministry. In referring such cases, the impact of the modifications on the estimates of repayment/interest which have gone into the Budget and Government’s resources position should be succinctly brought out by the administrative Ministry.

(ii) In examining proposals for modification of the period of the loan, the interest rate at which the loan was sanctioned should also be reviewed. In the case of a loan of which repayment has already commenced the revised rate of interest should be applied ab initio only to the residuary portion of the loan outstanding on the date of extension of its period.

(iii) Requests for waiver of recovery of normal interest (either for a specified period or for the entire period) on a loan which originally sanctioned at normal rate of interest, will attract the provisions of Rule 223 (1) of G.F.R.2005 and should be dealt with accordingly.

(G) Loans sanctioned at concessional rates:

(i) In cases where loans are to be sanctioned at a concessional rate, the instructions contained in Rule 223 (1) of G.F.R.2005 have to be observed. In such cases, payment of subsidy (to cover the concession viz. difference between normal rate and concessional rate) should be made conditional upon prompt repayment of principal and payment of interest thereon by the borrower.

(ii) In cases where loans are sanctioned interest free (e.g. loans to technical educational institutions for construction of hostels) prompt repayment should be made a condition for the grant of interest free loans. That is to say, the sanction letter in such cases should provide that in the event of any default in repayment, interest at rates prescribed by Government from time to time will be chargeable on the loans.

(iii) Similarly, in the case of interest free loans to departmental canteens where subsidy is also provided to meet running expenses, the sanction letter should stipulate that in the event of any default in repayment, the defaulted dues would be recovered out of the subsidy payable.

(H) Miscellaneous: A standard form prescribed for issue of loan sanctions (Appendix-I) should ordinarily be followed.

(i) The date of drawal of a loan by the borrower will be date on which he received cash, cheque or bank draft from the Drawing and Disbursing Officer. It should be ensured that the time lag between the date of obtaining the cash/cheque/bank draft and its disbursement/delivery/despatch to the payee is reduced to the minimum. Where the cheque or bank draft is sent through post, the date of posting should be treated as the date of disbursement of the loan. The Drawing and Disbursing Officer should invariably intimate the date of payment to his Accounts Office to enable the latter to make a suitable note in his records.

(ii) In the case of loans sanctioned to parties other than State and Union Territory and Foreign Governments and Government Servants, the borrower should tender the amounts due on or before the due date, at the New Delhi Office/Main Office of the public sector bank accredited to the Ministry/ Department which sanctions the loan, in cash or by cheque or draft drawn on any scheduled bank in Delhi/New Delhi in favour of the said PSB Branch. The payment should be accompanied by a memorandum or challan in duplicate indicating (a) name of the loan sanctioning Ministry/Department; (b) No. and date of the loan sanction letter and the loan amount sanctioned; (c) amount due for payment separately for interest and principal and the head(s) of account to which the dues are to be credited in the Government Accounts; and (d) due date of payment. The borrower should be asked to tender separate chequ Outstation loanees are required to arrange the dues through their bank ensuring that the memorandum/challan and the cheque/draft reaches the aforesaid PSB Branch in New Delhi by the due date.

(iii) Ministries/Departments are required to keep close watch on timely repayments of loans advanced by them and recovery of interest thereon. Rule 220 (1) (viii) of G.F.R. 2005 provides for a notice to be given to the borrowers a month in advance of the due date of payment of instalment of the principal and/or interest thereon. Such notices may be sent in the form given in Appendix II. The borrower should not however be given any advantage in the event of non-receipt of such a notice. Repayments/interest payments due from the loanees should also be reviewed at least quarterly, and where any default has occurred, a fresh notice should be served on the borrower to arrange payment with penal/higher rate of interest in the form set out in Appendix III.

(iv) Individual cases relating to terms and conditions of loans need not be referred to the Department of Economic Affairs (Budget Division) unless it is proposed to deviate from those laid down in this Office Memorandum.

This issues with the approval of Finance Minister.

sd/-
(Vyasan R)
Deputy Secretary (Budget)

Click to view the order

Authority: www.finmin.nic.in

Stay updated on the go with CENTRAL GOVERNMENT NEWS App. Click here to download it for your device.

Be the first to comment - What do you think?  Posted by admin - January 25, 2017 at 1:35 pm

Categories: Loan   Tags: , , , , , ,

PNB makes home, auto loans attractive for government staff

PNB makes home, auto loans attractive for government staffNew Delhi: To cash in on the 7th Pay Commission payout to government employees, state-owned Punjab National Bank (PNB) is offering them home and auto loans at attractive rates of 9.3-9.8 per cent beginning this month.

Besides, the bank said it will offer loans to these segments without any processing or upfront fee and no documentation charges will be levied on them.

The rate of interest is with effect from October 1, 2016.

The Delhi-based state lender said the objective of the drive — christened as ‘PNB Pride’ — is to “ensure availability of housing and vehicle loan at attractive rates and ensure a house and a car for all government employees”.

For housing loans, the floating interest rate has been fixed at marginal cost of lending rate (MCLR) for one year at 9.3 per cent. For those availing the housing loan on a fixed rate basis, it will be a floating one of interest plus 0.50 per cent (i.e, 9.8 per cent).

For car loan, customers will be charged MCLR of one year plus 0.25 per cent (9.55 per cent) on a floating basis. As for fixed interest rate with a reset clause of 3 years, it will be MCLR of one year plus 0.25 per cent, or 9.55 per cent.

Permanent employees of central and state governments, defence personnel and paramilitary forces will be able to avail of the benefits of lower rates under the PNB Pride scheme.

All other terms and conditions of the existing housing and car loan scheme will be applicable to the borrowers, PNB said.

PTI

Be the first to comment - What do you think?  Posted by admin - October 11, 2016 at 3:07 pm

Categories: Loan   Tags: , , , ,

HOUSE BUILDING ADVANCE for Central Government Employees

HOUSE BUILDING ADVANCE

Housing Loan for Central Government Employees…

General Rules for HBA :-

The advance granted to all permanent Central Government Employees.

The advance granted, who has completed minimum 10 years continuous service.

The advance granted for construction / purchase of house / plot.

The advance granted for purchase of ready-built house / flats.

The advance granted for buying a plot or flat under Co-operative Schemes.

The advance granted for enlarging existing accommodation.

The advance granted for purchase of houses / flats under Self Financing Housing Schemes and Co-operative Group Housing Schemes.

General Conditions for HBA :-

Employees should not have availed of any loan or advance for the purpose from any other Government sources.

Employee or spouse or minor child should not already own a house.

Cost Ceiling :-

Cost of the house (excluding cost of the land) should not exceed 134 times of the Basic Pay, subject to a minimum of Rs.7.5 lakhs and a maximum of Rs.18 lakhs. (If both husband and wife are working central government services, the pay of both of them will be taken into consideration for calculating the cost ceiling).

Sanction Amount :-

The amount of House Building Advance admisssiable for employees is 34 times of the Basic Pay or Rs.7.5 lakhs or cost of the building or repaying capacity, whichever is least.

RATE OF INTEREST :-

(Note: No interest is chargeable beyond the date of retirement / death of the Government Servant.)

HBA

sanctioned amount

26-7-90 to

15-12-97

16-12-97 to

31-3-2001

1-4-2001 to

31-3-2002

1-4-2002 onwards

Rs. 25,000/-

7.5%

7.5%

6.5%

6%

Rs. 50,000/-

7.5%

7.5%

6.5%

6%

Rs. 75,000/-

9%

9%

8%

7.5%

Rs. 1,00,000/-

9%

9%

8%

7.5%

Rs. 1,25,000/-

10%

9%

8%

7.5%

Rs. 1,50,000/-

10%

9%

8%

7.5%

Rs. 2,00,000/-

11%

11%

10%

9.5%

Rs. 2,25,000/-

11.5%

11%

10%

9.5%

Rs. 2,50,000/-

12%

11%

10%

9.5%

Rs. 5,00,000/-

….

11%

10%

9.5%

Rs. 7,50,000/-

….

12%

11%

10.5%

(Note: The advances carry interest from the date of payment of the first installment and is calculated on the balance outstanding on the last day of each month.)

Income Tax Rebate for HBA :-

Repayment of Principal sum of H.B.A. is exempt u/s 88 of Income Tax Act.

Exemption for Interest portion of HBA is admissible up to maximum of Rs. 1,50,000/-.

If any individual has drawn House Building Loan from any other financial institution, at the end of the year he should obtain a certificate from that financial institution showing repayment of loan details. In that repayment of Principal sum and Interest portion should be clearly mentioned. Accordingly income tax rebate can be taken on principal sum and interest sum.

Interest is calculated on the balance of HBA outstanding on the last day of the month i.e. on the IBB just like calculation of interest on advance for purchase of conveyance, etc.

Interest on H.B.A. is exempt u/s 24(b) of Income Tax Act.

Family Planning Concession for HBA: –

Concessional interest to Central Government Employees for promoting Small Family Norms. – The rate of interest will be half per cent less for an employee who undergoes sterlization.

Be the first to comment - What do you think?  Posted by admin - September 30, 2015 at 11:13 am

Categories: Employees News, Loan   Tags: , , , , , , ,

Loan for Low Cost Houses

Loan for Low Cost Houses

Reserve Bank of India vide circular DBR.BP.BC.No. 74/08.12.015/2014-15 dated March 5, 2015 on “Housing Loans: Review of Instructions” has allowed banks to add stamp duty, registration and other documentation charges to the cost of the house/dwelling unit for the purpose of calculating Loan to Value (LTV) ratio, in cases where the cost of the house/dwelling unit does not exceed Rs. 10 lakh. This has been done with a view to encourage availability of affordable housing to borrowers from economically.

This was stated by Shri Jayant Sinha, Minister of State in Ministry of Finance in written reply to a question in the Lok Sabha today.

PIB

Be the first to comment - What do you think?  Posted by admin - May 8, 2015 at 5:16 pm

Categories: Employees News, Latest News, Loan   Tags: , , , ,

Minutes of PNM/AIRF meeting – discussion on left over items held on 20.02.2015

F.No.2014/E(LR)I/NM 1–9

Sub: PNM/AIRF meeting held on 12-13 December, 2014 – discussion on left over items held on 20.02.2015 in Committee Room, Rail Bhawan-Minutes thereof.
………

The following officers and representatives of AIRF attended the meeting:

Official Side AIRF
S/Shri/Smt.
M. Akhtar, AM(Staff)
Neera Khuntia, EDPC-II
P.P. Sharma, EDE(G)
K. Shankar, DE(P&A)
D.V. Rao, DE(LL)
Anuradha Singh, D(MPP)
D. Mallik, DE/IR
S/Shri
Rakhal Das Gupta, President
Shiva Gopal Mishra, Genl. Secretary
J.R. Bhosale
Mukesh Galav
N. Kanniah



EDPC-I

5/2006: Avenues of promotion of Senior Supervisor in Scale S-13 to S-14 Group ‘B’ (Gazetted) on railways.

Official stated that the matter has been referred to Ministry of Finance. However, as agreed in the Fast Track Meeting, this will also be discussed by EDPC with the concerned officer(s) of Ministry of Finance to explain to them once again that upgradation is different from pay revision.

16/2008: Assured Carrier Progression Scheme applicable to Motormen of BCT division of Western Railway.

Official Side advised that Western Railway vide Board’s letter dated 04.07.2014 was asked to furnish the factual position in the matter which is still awaited. Federation told that a reply has been sent by Western Railway a day before. It was agreed to connect and examine the same. However, copy of Board’s Letter 04.07.2014 will also be given to the Federation, as desired by them.

30/2008: Voluntary Retirement of Drivers and Gangmen.

It was explained that the demand of Federation that staff retiring in GP `1900/- and eligible in LARSGESS and whose ward is to be appointed in the GP `1800/- may also be allowed the same eligibility conditions prescribed for railway employees retiring in `1800/- (i.e. 20 years and age bracket of 50-57 years), has already been examined and it was decided by Board that as posts in GP `1900/- are Group ‘C’ posts, relaxing the eligibility conditions to 20 years from the existing 33 years qualifying service and age bracket of 55-57 years is not feasible of acceptance. However, the other demand of constituting the Assessment Committee in respect of GP `1900/- at Divisional level has already been accepted and necessary instructions in this regard have also been issued vide Board’s letter dated 03.01.2014.
However, Federation insisted for a review on the 1st issue raised.

6/2009: Extra Ordinary Leave in continuation with Maternity Leave taken without production of proper medical certificate.

The provisions on the issue i.e. ‘EOL in continuation with Maternity Leave without production of Medical Certificate-treatment of this period as qualifying service’ has been reiterated vide Board’s Letter dated 11.07.2014.
(Closed)

10/2009: Liberalization in the Safety Related Voluntary Retirement Scheme.

Necessary instructions issued vide Board letter dated 03.01.2014.
(Closed)

12/2009: Grant of PCO Allowance/Incentive Bonus to technical staff supporting shops/Sections (including CMT/C&M Lab.), Drawing/Design, I.T. Power Supply and Stores etc.) – in Railway Workshops and Production Units- Treating them as part of Inspection, Planning & Planning & Progress wings of PCO.

A separate meeting with AM/PU on this issue was held on 04.12.2014. Federation desired that follow up action be advised to them.

7/2010: Inclusion of left out categories of the staff working in Railway Hospitals of the Indian Railways for the purview of Hospital Patient Care Allowance.

Federation was advised that two more categories i.e. Physiotherapist and Dental Hygienist are being considered under the purview of HPCA in consultation with Health Directorate of Railway Board and the Ministry of Health & Family Welfare.
However, the Federation insisted that the other categories viz., cooks, Masalchis who are allowed HPCA under the orders of Health Ministry which is the nodal Ministry in the matter, may be allowed HPCA. Their demand was noted for examination.

9/2010: Grant of pay scales of `5000-8000 w.e.f. 01.01.1996 to the Sub-Overseer Mistry/ Supervisor(Works), now Jr. Engineer (Works).

Federation has been replied in the matter vide Board’s Letter dated 07.07.2014 to which no further reference has been received. Federation will get back, if necessary.

17/2010: Payment of Transport Allowance to the staff living in Ghaziabad (Northern Railway).

It was explained to the Federation that the matter has been consulted with Ministry of Finance who have clarified that the Railway employees posted at Ghaziabad, Faridabad, Gurgaon and Noida are entitled to Transport Allowance at the rates as applicable to ‘other places’.
However, the Federation brought out that this has been allowed in some other offices. It was agreed to connect such orders and examine the issue.

27/2010: Implementation of recommendations of VI CPC – Grant of Transport allowance to Railway employees.

This issue will be discussed by the Federation with Board (MS and FC).

3/2011: Revision of rates of Kilometreage Allowance and Allowance in lieu of Kilometreage (ALK).

The matter is being deliberated by a committee constituted.

4/2011: Placement of Pharmacists in the Entry GP of `4200(non-functional grade) on completion of two years service in GP `2800 as well as grant of three MACPs to the Pharmacist category on the Indian Railways.

Reference has been made to Ministry of Finance for waiving off the overpayment made on account of erroneous grant of financial upgradation to Pharmacists. Reply from MOF is still awaited.

9/2011: Caretaking Allowance to Hostel Staff and merging of Caretaker posts with Ministerial Staff.

A detailed proposal for merger of caretaking staff with ministerial staff was called from IRISET which has since been received and the matter is under process.

10/2011: Grant of pay scale `5000–8000 (pre–revised)/ PB–II GP `4200 in new pay scales to Tower Wagon Drivers of Electrical Department.

Details regarding number of TWDs, their qualifications, scale of pay, method of selection etc. have been obtained from the Zonal Railways and the same is under examination.

13/2011: Grant of LAP, LHAP and Casual Leave to paramedical staff engaged to work in Railway Hospitals etc. on contract basis.

Official Side mentioned that para medical staff engaged to work on contract basis in Railway Hospital etc. are not treated as railway servants. As such they cannot be brought under the purview of leave provisions applicable to railway servants.
Federation stated that of late contract labour has been introduced in the railways and they are to be treated at par with casual labour. Federation also drew attention to Court orders on the issue of casual labour.

30/2011: Issue of PPOs and making entry of payment of Medical Allowance to Pensioners/ Family Pensioners.

Division – wise status of implementation of Board’s instructions dated 02.11.2012 on the issue of grant of FMA to railway pensioners has been reiterated on 08.12.2014. However, if the Federation has any specific instance of non payment by any bank, that can be taken up separately with concerned bank.

8/2012: Extension of second chance in the matter of Aptitude Test under LARSGESS Scheme.

Discussed.

18/2012: Payment of Breakdown Overtime Allowance to Mechanical Supervisors(C&W) – Mechanical Department.

Federation insisted that the demand may be considered in the light of instructions issued vide Board’s letter No.E(P&A)II -98/BDA-1 dated 25.05.1999. It was agreed to examine the matter.

32/2012: (A) Wrong implementation of MACP Scheme in IT Cadre.(B) Granting of financial benefit under MACP Scheme to EDP Staff.

Official Side stated that a separate meeting was held on this issue on 24.07.2013 wherein it was agreed that the Federation will provide further input after gathering information in respect of IT cadre of other Ministries. However, no input has been received from the Federation so far. Further, Federation requested for inclusion of this issue in the list of items to be discussed with MS & FC.
38/2012: Extension of scope of LARSGESS.
Federation insisted that the suffix ‘working on track’ in Board’s letter dated 24.03.2014 should be done away with because the same employee who has been covered under this scheme may be working at different places at different point of time and may not always be working on the track. It was agreed to examine the demand in consultation with Establishment Directorate.

40/2012: Earmarking of posts for promotion of Non-Appendix 3 IREM Qualified Accounts Assistants in the merged cadre of Sr. SO(A/Cs) and SO(A/Cs).

Federation requested for a meeting with Adviser (Accounts).

46/2012: (A) Payment of Running Allowance to medically de-categorised Running Staff kept on supernumerary posts.(B) Fixation of pay of medically de-categorized Running Staff while kept on supernumerary posts- Grant of benefits of Running Allowance.

Federation stated that they will reply to Board’s letter dated 12.09.2014. The demand is to be re-examined thereafter.

15/2013: (A) Proper implementation of LARSGESS in case of the candidates declared unsuitable in PET in 2010 Cycle.

(B) Minimum educational qualification for appointment under LARSGESS – Case of the wards of railway employees opted for LARSGESS in the year 2010.

(D) Alternative appointment to the wards of the railway employees under LARSGESS who failed to qualify the prescribed medical examination

Position explained to the Federation. However, Federation demanded that nonMatriculate wards should be given employment in 1S (`1300) and after six month training, they may be placed in GP `1800, which is to be examined.

23/2013: Denial of appointment under LARSGESS to the wards of railway employees working in Safety Categories.

Discussed.
(Closed)

24/2013: Payment of Special Allowance to Traffic Gatemen deployed to work on Level Crossing Gates.

The matter is under process. However, the Federation demanded that it should be done as in the case of Engg. Gates.

28-B/2013: Provision of Child Care Leave for women employees.

It was brought out by the official side that stipulation for making arrangement for leave reserve has not been laid down in the provisions on CCL by DOP&T. As such, this Ministry cannot unilaterally alter or modify the existing provisions.
However, AIRF insisted that Indian Railway being operating and industrial department the Railway Board should review and decision should be taken to facilitate women employee for forwarding them hassle free CCL .

29/2013: Stepping up of pay to Loco Running Supervisors promoted prior to 01.01.2006, viz-à-viz their juniors promoted after 01.01.2006.

Official Side stated that the matter is subjudice and is also being deliberated in Fast Track Committee. Federation demanded that recovery may be pended till the matter is finalised.

13/2014: Fixation of pay in case of financial upgradation under MACPS.

Official Side explained that while granting financial upgradation under MACP Scheme and fixation of pay in context thereof involves financial implications, it is logical that the concurrence of Associate Finance be obtained as per principles of financial propriety.

15/2014: MACP Scheme for Railway Servants – Treatment of employees selected under LDCE/GDCE Scheme – Clarification reg.

Position was explained to the Federation bringing out why the demand cannot be agreed to. However, on their insistence it was agreed to re-examine the matter.
ED(T&MPP)

1/2012: Revised Training Modules for Supervisors of Mechanical Engineering Department.

Instructions have been issued to Zonal Railways/Pus vide Board’s Letter No.E(MPP)2009/3/10 dated 28.02.2013. As regards Promotee Supervisors, instructions have been issued to Zonal Railways vide Board’s Letter No.E(MPP)2009/3/22 dated 26.09.2014.
EDE(G)

29/2011: Retention of railway quarter in favour of totally medically incapacitated railway employees.

Paper put up to Board through Finance.

47/2012: Retention of Railway accommodation at the previous place of posting in case of staff posted in newly formed Divisions.

Necessary instructions have already been issued vide Board’s Letter No.E(G)2007 QR1-5 dated 05.09.2014.
(Closed)

EDE(G)/DE(W)

21/2010: Revision in the Dress Regulations – 2004.

Discussed with both the Federations (AIRF and NFIR) and matter is under finalisation.

19/2011: Raising of upper age limit in case of entitlement of Privilege Passes/PTOs for dependent sons.

On the insistence of the Federation, it was agreed to review the matter and file to be put up to Member Staff.

7/2012: Implementation of various welfare schemes announced by the then Hon’bleMinister for Railway during her Rail Budget Speech.

Federation requested for details of action taken on the various recommendations as also a meeting with the Hon’ble MR before the Rail Budget. It was agreed to send them the position separately.

12/2012: Provision of Post Retirement Complimentary Passes in favour of widows of ex-railway employees.

&

1-A/2013: Provision of Post Retirement Complimentary Passes to the spouse/widow of deceased railway employees appointed on compassionate ground.

Official Side explained that the matter has been re-examined in consultation with Finance Dte. The request was, however, not considered feasible due to wider legal and administrative implications.
Federation requested for a separate meeting associating EDF(E).

28/2012: Sanction of Flood Relief Fund for the flood affected staff over the Indian Railways.

Managing Committee of Railway Minister’s Welfare & Relief Fund did not approve financial assistance for flood affected Railway employees residing Varanasi due to heavy rains in August, 2008 as the event/incident pertained to an earlier period and RMW&RF cannot be a source for reimbursement/refund for loss caused earlier. Furthermore, these floods were not declared as natural calamity by any appropriated authority.
No proposal has been received for financial assistance at Jaunpur and Mughalsarai.
Proposal for financial assistance at Ambala was not agreed to by SBF Calamity Relief Fund Committee.
Federation desired action taken in case of Vishakhapatnam calamity and J&K floods. Federation urged that fast action be taken in respect of these cases.

4/2013: Reduction in lower age limit of the pensioners/their widows from 65 to 60 years for entitlement of Companion in lieu of Attendant to 1st Class/1st A Class Post Retirement Complimentary Passes.

Discussed.
(Closed)

7/2014: Issue of Special Passes on medical ground in favour of two attendants in case of kid patient.

To be examined again.

10/2014: Provision of two sets of Post Retirement Complimentary Passes to retired railway employees working in GP `1800.

Official Side brought out that Finance Directorate has not agreed to the Federation’s demand. However, on their insistence, it was decided to put up the papers afresh to Member Staff.

11/2014: Entitlement of Passes to the widows as Dependent in the Passes issued to their wards – Enhancement of income limit for the same.

Position explained.
(Closed)

Source: http://www.indianrailways.gov.in/railwayboard/uploads/directorate/establishment/E%28LR%29/airf%20lo%2015-02-20.pdf

Be the first to comment - What do you think?  Posted by admin - April 30, 2015 at 4:29 pm

Categories: 6CPC, Allowance, Dearness Allowance, Employees News, General news, HRA, Latest News, Loan, LTC, Pension, Promotion, Railways, Rank Pay, Retirement Age   Tags: , , , , , , , , , , , , , , , ,

Home Loan Rates in 2015: Here’s Your Guide

Home Loan Rates in 2015: Here’s Your Guide

As soon as one starts looking out at properties to buy a house, banks start offering home loans. This can be overwhelming at times. Making a choice then largely depends on comparing what competitor banks have to offer. Here is a list, which compares home loan rates by different banks.
For a loan amount up to Rs 30 lakh and the tenure being 15-20 years, the following is on offering.

1. Floating interest rate of 10.15 per cent
This rate is being offered by the following organizations:

SBI ( State Bank of India)
ICICI Bank
HDFC Bank
HSBC Bank
Axis Bank
PNB Housing Finance
DHFL
India Bulls ( Up to Rs 25 lakh)
Citi Bank
Tata Capital Housing Finance Ltd

EMI per lakh works out to be Rs 975.

SBI charges a processing fee of 0.25 per cent of the loan amount up to Rs 25 lakh or minimum Rs 1000. For a loan amount above Rs 25 lakh the processing fee is Rs 3,250. Citibank charges 0.25 per cent of the loan amount. ICICI, HDFC and PNB charge 0.5 per cent of the loan amount as processing fees. However, HDFC has capped the maximum amount to Rs. 10,000. Whereas, Axis Bank and HSBC charge a minimum processing fee of Rs 10,000 or 1 per cent of the total loan amount. DHFL charges Rs 5000 plus document charges and taxes and India Bulls charges Rs 7,500 plus taxes.

2. Floating interest rate of 10.20 per cent
This rate is being offered by the following banks:

Federal Bank
Bank of India
UCO Bank
Canara Bank

The EMI per lakh works out to be Rs 978.

Federal Bank and UCO Bank both charge 0.5 per cent of the loan amount. The minimum amount charged is Rs 3000 and Rs 1500 whereas maximum is Rs 7500 and Rs 15,000 respectively by both the banks. Bank of India has decided to waive off processing fees on new loans sanctioned up to March 2015.

3. Floating interest rate of 10.25 per cent
This rate is being offered by the following lenders:

IDBI
Punjab National Bank
Allahabad Bank
Central Bank of India
Corporation Bank
Union Bank of India
United Bank of India
Bank of Baroda
Oriental Bank of Commerce
Kotak Bank
Dena Bank
First Blue Home Finance
Syndicate Bank
Indian Overseas Bank
State Bank of Travancore
Indian Bank

The EMI per lakh works out to be Rs 982.

IDBI, Punjab National Bank and Oriental Bank of Commerce have NIL processing fees. State Bank of Travancore does not charge any processing fee up to a loan amount of Rs 25,000 and United Bank of India has waived off processing fee for a loan amount up to Rs 75 lakh. Processing fee ranges from 0.25 per cent to 0.5 per cent of the loan amount. Allahabad Bank charges 0.6 per cent of the loan amount with a cap of Rs 12,000 while India Overseas Bank charges 0.58 per cent of the loan amount with a cap of Rs 10,190.

4. Floating interest rate of 10.26-10.30 per cent
Standard Chartered Bank offers 10.26 per cent on home loans with a processing fee of Rs 5500 plus service tax. The EMI works out to be Rs 982.

Vijaya Bank charges 10.30 per cent and the EMI works out to be Rs 985. The processing fee is 0.25 per cent of the loan amount with a cap of Rs 10,000.

5. Floating interest rate of 10.50 per cent and above
Deutsche Bank offers an interest rate of 10.5 per cent and a flat processing fee of Rs 12,000 plus taxes. EMI per lakh works out to be Rs 998.
Bank of Maharashtra offers 10.55 per cent (up to 25 lakh) and 10.75 per cent above that. Accordingly the EMI works out to be Rs 1001 and Rs 1015 respectively. Processing fee is 0.25 per cent of the loan amount subject to maximum of Rs 25,000.
ING Vysya offers 10.75 per cent, the EMI for which works out to Rs 1015. Processing fee is 0.5 per cent of the loan amount.
Development Credit Bank and Dhanalakshmi Bank offer 11.50 per cent and charge a processing fee of 1 per cent. EMI per lakh works out to be Rs 1066.

6. Fixed rates on offer
LIC Housing Finance offers 10.10 per cent (fixed for 2 years)
HDFC Ltd offers 10.15-10.65 per cent (fixed for 2-3 years) and 10.25- 10.75 per cent (fixed for 10 years).
Axis Bank offers 10.40 per cent (fixed for 20 years)

Look out for festive offers when processing fee is waived off and always negotiate for better rates. Request your bank official to share complete details so that there are no surprises in the form of hidden charges, pre-payment charges etc. Also, find out about special rates applicable for self-employed individuals and women.

Hope this compilation helps you in analysing what suits you best.

Data source: deal4loans.com

Be the first to comment - What do you think?  Posted by admin - February 16, 2015 at 9:14 am

Categories: General news, Loan   Tags: , , ,

Allowance/Advance shall automatically increase by 25% everytime DA goes up by 50%: CGDA clarified – No separate order is required

Allowance/Advance shall automatically increase by 25% everytime DA goes up by 50%: CGDA clarified – No separate order is required

Allowance/Advance shall automatically increase by 25% everytime DA goes up by 50% – CGDA’s clarification – no separate order is required for revision of allowances/advances by 25% on the original amount w.e.f. 01.01.2014

Controller General of Defence Accounts
Ulan Batar Road, Palam, Delhi Cantt-110010
No. AN/XIV/6th CPC/Corr./Vol-XII

Dated: 29.04.2014

To
All PCsDA/CsDA

Sub: Enhancement of rates of various allowances by 25% everytime DA payable on the revised pay structure goes up by 50%.

Consequent on revision of rates of Dearness Allowance from existing 90% to 100% vide MoF OM dated 27.03.2014, references are being received in this HQrs office seeking clarification regarding separate orders for revision of rates of certain allowances/advances where a specific clause indicates that the allowance/ advance shall automatically increase by 25% everytime DA payable on the revised pay structure goes up by 50%.

2. The matter has been examined in this HQrs office and it is clarified that automatic revision will take place only in respect of those allowances for which a specific clause of automatic increase has been provided in respective original Govt. orders. Therefore, no separate order is required for revision of allowances/advances by 25% on the original amount w.e.f. 01.01.2014

3. This issues with the approval of Jt. CGDA (AN)

 

sd/-
(Upendra Kumar)
For CGDA

Source: www.cgda.nic.in
[http://cgda.nic.in/adm/enhancement%20of%20rates%20of%20allowance%20290414.pdf]

Be the first to comment - What do you think?  Posted by admin - April 30, 2014 at 2:36 am

Categories: Allowance, DA Over 50%, Dearness Allowance, Employees News, Expected DA, Latest News, Loan   Tags: , , , , , , , , ,

Time Limit for Repayment of Educational Loans

Time Limit for Repayment of Educational Loans

 

GOVERNMENT OF INDIA
MINISTRY OF FINANCE
LOK SABHA

UNSTARRED QUESTION NO 428

ANSWERED ON 06.12.2013

 TIME LIMIT FOR REPAYMENT OF EDUCATIONAL LOANS

428 . Shri R. THAMARAISELVAN

Will the Minister of FINANCE be pleased to state:-

(a) the existing time limit fixed by the Government/Reserve Bank of India (RBI) for repayment of educational loans taken by students to pursue higher studies abroad;
(b) whether the Government proposes to expand the said time limit; and
(c) if so, the details thereof and the reasons therefor?

ANSWER

(MINISTER OF STATE IN THE MINISTRY OF FINANCE) (SHRI NAMO NARAIN MEENA)

(a) : As per revised Model Education Loan Scheme of Indian Banks’ Association (IBA), the students are allowed repayment period of 10 years for education loans upto Rs 7.50 lakh and 15 years for loans above Rs 7.50 lakh.

Students are allowed repayment holiday/moratorium during course period plus 1 year or 6 months after getting the job which ever is earlier.

(b) & (c) : No such proposal is under consideration of the Government at present.

Source: Lok Sabha
Via: http://karnmk.blogspot.in/2013/12/time-limit-for-repayment-of-educational.html

Be the first to comment - What do you think?  Posted by admin - December 15, 2013 at 2:13 pm

Categories: Loan   Tags: , ,

Loans and Advances by the Central Government – Interest rates and other terms and conditions

Loans and Advances by the Central Government – Interest rates and other terms and conditions

F.No.5(3)-B(PD)/2012
Government of India
Ministry of Finance
Department of Economic Affairs

New Delhi, the 7th January, 2013

OFFICE MEMORANDUM

Subject:- Loans and Advances by the Central Government – Interest rates and other terms and conditions.

Reference this Ministry’s Office Memorandum F.No.5(3)-B(PD)2011 dated 19 th March, 2012 on the captioned subject.
2. The lending rates prescribed in the aforesaid Office Memorandum have been reviewed. The revised rates of interest applicable from 1st April 2012 are given in the Table below:—

Category of borrower & type of loan Interest rate per cent per annum
1. State Governments:
(i) Ways and Means Advances (Recoverable within the

year)

8.50
(ii) Other Loans 9.00
2. Union Territory Governments (with Legislature):
(i) Loans upto 1 year 8.50
(ii) Other Loans 9.00
3. Industrial and Commercial Undertakings in the Public Sector and Cooperatives
(i) Investment loans 11.50
(ii) Working Capital loans and loans to meet Cash losses 13.50
(iii) Loans for implemantation of VRS in sick PSUs 11.50
4. Financial institutions in the Public Sector, Port Trusts, KVIC, NHAI, Municipal Corporation of Delhi,Commodity Boards, Social Service Institutions, Individuals, etc.
(i) Rural Electrification Corporation:
(a) For Minimum Needs Programme (M.N.P.) 10.00
(b) Others 10.00
(ii) National Bank for Agriculture and Rural
Development (NABARD) and National Cooperative Development Corporation (NCDC) 10.00
(iii) National Highways Authority of India (NHAI) and Port Trusts 10.00
(iv) Others 11.50

 

The rate of interest prescribed for “Other Loans” under sub-para 1 (ii) and 2 (ii) above is also applicable for Additional Central Assistance (ACA) on the un-disbursed amount of the loan/issues for all disaster Reconstructions and Rehabilitation Programme assisted by World Bank & ADB.

The loans to State Electricity Boards, Damodar Valley Corporation under the scheme for renovation and modernisation of thermal power stations would carry interest at the same rate as applicable to ‘Other Loans’ to State Governments. Normally, loans should not be given to Private
Sector Companies. In exceptional cases where such loans become necessary interest should be 1/2% higher than those prescribed for Public Sector.

3. The terms including interest rate of loans to Foreign Governments may be settled in consultation with Budget Division. Terms for on-lending of funds under externally aided projects should be in accordance with the prescribed pattern. In case, deviation is considered necessary, Budget Division should be consulted.

4. The interest rates prescribed above assume timely repayments and interest payments and hence no further rebate in rates is to be allowed for timely payments.
5. OTHER TERMS AND CONDITIONS

The instructions issued from time to time have been reviewed and are set out in the following paragraphs for facility of reference.
6. STATE GOVERNMENTS

In the case of loans to State Governments , the arrangements for payment of annual instalment of principal and interest will be as under:-
(a) Block loans for State Plan Schemes and other Plan loans for Centrally Sponsored Schemes:-

These loans when drawn in installments, will be consolidated and deemed to have been drawn
as on 1st October in each year. The maturity period of the loans sanctioned for State Plans is 20 years, repayments being made in 20 annual equal instalments together with interest on the
outstanding balance commencing from the following year, subject to consolidation under the award of Twelfth Finance Commission (TFC). However, fifty per cent of these loans will enjoy a five year initial grace period, after which repayments of these loans will be effected in 15 annual equal instalments. The amounts annually payable (by way of principal and interest) would be recovered in 10 equal monthly instalments commencing 15th June, subject to debt waiver under the award of TFC.

(b) Other Loans:-

The terms of repayment of these loans will be as laid down from time to time.

7. PUBLIC SECTOR PROJECTS

(A) For new installations or expansion of existing institutions:

(a) The terms and conditions of loans should be fixed with reference to the financial picture presented in the approved Project Report. (Once the pattern is settled, there should be no change except with the specific concurrence of this Department for reasons to be stated in writing).

(b) The capital requirements of a project should include adequate provisions for interest payment on borrowings during the period of construction (as specified in the Project Report). The interest on loans due during the period of construction will be allowed to be capitalised to the extent of the provisions made for this purpose in the approved Project Report. In other words, while interest on loans advanced to an undertaking during the period of construction will be notionally recovered by allowing its capitalisation, the payment of interest should effectively commence after the construction period is over.

(c) The repayment of principal should ordinarily commence one year after the project commences production, the number of instalments being determined with reference to the financial projections and repaying capacity specified in the Project Report. Requests for further moratorium will be considered only in exceptional cases where the Project Report has
specified any special circumstances that may necessitate a longer period of moratorium and has indicated clearly what staggering of repayment would be needed over the necessary break period. The period of loans sanctioned against capitalised interest during the period of construction may also be on the same terms and conditions as are applicable to loans provided for financing the project costs.

(d) A suitable period of moratorium subject to a maximum of five years from the date of drawal of the loans may be allowed for the repayment of instalments of principal, having regard to the
nature of the project, the stage of construction etc. The period of moratorium should not, however, extend in any case, beyond two years from the date of project going into production, or in the case of programmes of expansion, beyond two years from the date of expanded project coming into operation.

(B) For meeting working capital requirements:

The undertakings are expected to obtain their cash credit requirements from the State Bank of India/Nationalised Banks by hypothecating their current assets (such as stock of stores, raw materials, finished goods, work in progress, etc.) and where the entire working capital requirements cannot be raised in this manner by seeking a guarantee from Government. Accordingly, requests from Public Sector Undertakings for funds for meeting working capital
requirements should be considered only to the extent the same cannot be had from the State Bank of India/Nationalised Banks.

8. GENERAL REPAYMENT PERIOD

(A) (i) The period for repayment of loans for all parties other than State Governments should be fixed with due regard to the purpose for which they are advanced and it should be restricted to the minimum possible. Normally, no loan shouldbe granted for a period exceeding 10 years.
Where a longer period for repayment is sought, prior concurrence of the Budget Division in this Department will be necessary for fixing the period.

(ii) The repayment of a loan should normally commence from the first anniversary date of its  drawal or on expiry of the period of moratorium, as the case may be. The recovery should ordinarily be effected in annual equal instalments of principal.
(iii) The period of repayment of working capital loans should preferably be restricted to two or three years. In no case, however, the period of these loans should exceed 5 years.
(B) Moratorium : Subject to exceptions made in respect of pubic sector projects, a suitable period of moratorium towards repayment might be agreed to in individual cases having regard to the project for which the loans are to be utilised. However, no moratorium should ordinarily be allowed in respect of interest payment on loans. Ministries/Departments may with the approval of their Financial Advisers allow moratorium on repayment of principal wherever
considered necessary upto a maximum period of 2 years.

(C) (i) Repayment before due date: Any instalment paid before its due date may be taken  entirely towards the principal provided it is accompanied by payment towards interest due upto date of actual payment of instalment; if not, the amount of the instalment will first be adjusted towards the interest due for the preceding and current periods and the balance, if any, will alone be applied towards the principal. Where the payment of the instalment is in advance of the due date by 14 days or less, interest for the full period (half year or full year as the case may be) will be payable. If any State Government repays an instalment of a loan which is consolidated as on 1st October, in advance of the due date by more than 14 days the interest will be payable with
reference to the actual date of repayment.

(ii) Pre-payment premium: Prepayment premium of 0.25% on the loans with residual  maturity of less than 10 years and 0.50% for the loans with residual maturity of 10 years and
above, shall be charged. The provision does not apply to the loans to State/UT Governments.

(D) Penalty Clause: The loan sanctions/agreements should invariably include a penalty clause providing for levy of a penal rate of interest in the event of default in repayment of instalment(s) of principal and/or interest. The penal rate of interest should not be less than 2.50% above the normal rate of interest at which a loan is sanctioned.

(E) Defaults in repayment/interest payment: (i) In the event of a default in repayment of loan/interest payment, the recovery of interest at penal rate may not be waived unless there are special reasons justifying a waiver. However, a decision in this regard will be taken by the Ministry of Finance (Budget Division) on the advise of Financial Adviser. Even in such cases, a minimum of 0.25% should be recovered from the defaulting party as penalty.

(ii) The penal rate of interest is chargeable on the overdue instalments of principal and/or   interest from the due date of their payment to the date preceding the date of actual payment.

(iii) Whenever a fresh loan is to be sanctioned to a borrower who has earlier defaulted, the loan sanctioning authority must consider the question of recovery of defaulted dues. All releases to Public Sector Undertakings against budgeted outlays should be made only after adjusting the
defaults, if any, pertaining to repayment of loans and interest. If for special and exceptional reasons such adjustments are not possible, specific orders of Secretary (Expenditure) should be obtained through Budget Division, before release of fresh loans, in relaxation of extant orders, in conformity with this Division circular No.F.2 (190)-B(SD)/91, dated 15.10.1991.

However, no request for waiver/postponement of instalments on any ground whatsoever will be accepted,except in cases of companies referred to BIFR or in respect of those companies which have incurred cash losses for last three years, in conformity with this Division circular
No.F.2(165)-B(SD)/94, dated 06.10.1994.

(F) Requests for modification of terms of loans: (i) Borrowers are required to adhere strictly to the terms settled for loans made to them and modifications of these terms in their favour can be made subsequently only for very special reasons. Requests for modification of terms may relate to increase in the period of a loan or of initial moratorium period towards repayment, or waiver of penal interest or reduction in or waiver of normal rate of interest. The procedure of dealing with requests for waiver of penal interest has already been dealt with in paragraph 8. Cases involving other modifications in repayment terms should be considered in
consultation with the Budget Division in this Ministry.

In referring such cases, the impact of the modifications on the estimates of repayment/interest which have gone into the Budget and Government’s resources position should be succinctly brought out by the administrative Ministry.

(ii) In examining proposals for modification of the period of the loan, the interest rate at which the loan was sanctioned should also be reviewed. In the case of a loan of which repayment has already commenced the revised rate of interest should be applied ab initio only to the residuary portion of the loan outstanding on the date of extension of its period.

(iii) Requests for waiver of recovery of normal interest (either) or a specified period or for the entire period) on a loan which originally sanctioned at normal rate of interest,will attract the provisions of Rule 223 (1) of G.F.R. 2005 and should be dealt with accordingly.

(G) Loans sanctioned at concessional rates:

(i) In cases where loans are to be sanctioned at a concessional rate, the instructions contained in Rule 223 (1) of G.F.R. 2005 have to be observed. In such cases, payment of subsidy (to cover the concession viz. difference between normal rate and concessional rate) should be made conditional upon prompt repayment of principal and payment of interest thereon by
the borrower.

(ii) In cases where loans are sanctioned interest free (e.g. loans to technical educational institutions for construction of hostels) prompt repayment should be made a condition for the grant of interest free loans. That is to say, the sanction letter in such cases should provide that in the event of any default in repayment, interest at rates prescribed by Government from time to time will be chargeable on the loans.

(iii) Similarly, in the case of interest free loans to departmental canteens where subsidy is also provided to meet running expenses, the sanction letter should stipulate that in the event
of any default in repayment, the defaulted dues would be recovered out of the subsidy payable.

(H) Miscellaneous: A standard form prescribed for issue of loan sanctions (Appendix-I) should ordinarily be followed.

(i) The date of drawal of a loan by the borrower will be date on which he received cash, cheque or bank draft from the Drawing and Disbursing Officer. It should be ensured that the time lag between the date of obtaining the cash/cheque/ bank draft and its disbursement/delivery  despatch to the payee is reduced to the minimum. Where the cheque or bank draft is sent through post, the date of posting should be treated as the date of disbursement of the loan. The Drawing and Disbursing Officer should invariably intimate the date of  payment to his Accounts Office to enable the latter to make a suitable note in his records.

(ii) In the case of loans sanctioned to parties other than State and Union Territory and Foreign Governments and Government Servants, the borrower should tender the amounts due on or before the due date, at the New Delhi Office/Main Office of the public sector bank accredited to the Ministry/ Department which sanctions the loan, in cash or by cheque or draft drawn on any scheduled bank in Delhi/New Delhi in favour of the said PSB Branch. The payment should be accompanied by a memorandum or challan in duplicate indicating (a) name of the loan sanctioning Ministry/Department; (b) No. and date of the loan sanction letter and the loan amount sanctioned;

(c) amount due for payment separately for interest and principal and the head(s) of account to which the dues are to be credited in the Government Accounts; and (d) due date of payment. The borrower should be asked to tender separate cheques/drafts and challans for payment of principal and interest.Outstation loanees are required to arrange the dues through their bank ensuring that the memorandum/challan and the cheque/draft reaches the aforesaid PSB Branch in New Delhi by the due date.

(iii) Ministries/Departments are required to keep close watch on timely repayments of loans  advanced by them and recovery of interest thereon. Rule 220 (1) (viii) of G.F.R. 2005 provides for a notice to be given to the borrowers a month in advance of the due date of payment of  instalment of the principal and/or interest thereon. Such notices may be sent in the form given in Appendix II. The borrower should not however be given any advantage in the event of non-receipt of such a notice. Repayments/interest payments due from the loanees should also be reviewed at least quarterly, and where any  default has occurred, a fresh notice should be served on the borrower to arrange payment with penal/higher rate of interest in the form set out in Appendix III.

(iv) Individual cases relating to terms and conditions of loans need not be referred to the  Department of Economic Affairs (Budget Division) unless it is proposed to deviate from those laid down in this Office Memorandum.

(Peeyush Kumar)
Director (Budget)
Tel. No. 23092744

Source: finmin

1 comment - What do you think?  Posted by admin - September 1, 2013 at 3:44 pm

Categories: Employees News, General news, Loan   Tags: , , , , ,

State-wise educational loan outstanding of Public Sector Banks

State-wise educational loan outstanding of Public Sector Banks

The Government receives suggestions and representations highlighting the requirements of students in availing education loans, under the Model Educational Loan Scheme of Indian Banks’ Association (IBA). These are forwarded to Banks for corrective action.

Keeping in view the needs of the students and suggestions received from the stakeholders the Scheme is modified by Indian Banks Association (IBA) from time to time. The last such revision was made in September, 2012.

The outstanding education loans by Public Sector Banks has increased from Rs.35,855 crore in 19.11 lakh accounts as on last reporting Friday of March, 2010 to Rs.52,982 crore in 25.09 lakh accounts as on 31.12.2012. State-wise details, including for Kerala, is Annexed.

State-wise educational loan outstanding of Public Sector Banks

( Amount in Rs crore ) ( No. of A/Cs in actual)

As on the last reporting Friday of March

2010
2011
2012
As on 31.12.2012**
State/Union Territories
No.of Accounts
Balance O/S
No.of Accounts
Balance O/S
No.of Accounts
Balance O/S
No.of Accounts
Balance O/S
NORTH EASTERN REGION 15502 375.1 17875 431.48 20071 510.36 25810 634.7
Assam 11166 267.6 12941 303.82 14489 363.13 15868 398.41
Meghalaya 930 22.22 1257 29.51 1445 34.5 1735 44.65
Mizoram 439 16.37 585 21.22 664 23.92 753 27.66
Arunachal Pradesh 463 10.03 372 8.29 476 10.54 539 12.41
Nagaland 239 6.38 336 8.54 361 9.57 3139 62.9
Manipur 1259 31.86 1164 35.28 1057 36.38 1160 35.13
Tripura 1006 20.64 1220 24.82 1579 32.33 2616 53.54
EASTERN REGION 188325 3841.58 239414 5064.19 259993 5922.57 333929 8150.42
Bihar 43395 939.44 62597 1380.69 78733 1799.2 88851 2283.63
Jharkhand 31620 687.61 38088 927.45 41552 1086.17 47946 1273.92
West Bengal 60456 1195.03 72617 1373.54 71378 1512.76 69558 1627.94
Orissa 52158 1002.88 65289 1363.94 67008 1474.88 69530 1695.2
Sikkim 346 9.25 338 8.53 382 16.44 6353 115.69
Andaman& Nicobar 350 7.37 485 10.05 940 33.12 51691 1154.04
CENTRAL REGION 213087 4127.73 240483 4863.77 252846 5445.27 266631 6255.29
Uttar Pradesh 109450 2287.8 126071 2790.72 136448 3095.02 143486 3572.67
Uttarakhand 19725 396.69 22795 502.06 24536 560.06 25933 633.41
Madhya Pradesh 72378 1195.17 76968 1289.16 76773 1477.34 81478 1711.02
Chattisgarh 11534 248.07 14649 281.83 15089 312.86 15734 338.19
NORTHERN REGION 159588 3962.4 174427 4239.92 182914 4526.94 188457 4894.98
Delhi 36187 1155.04 36445 1096.2 36362 1104.9 33661 1079.19
Punjab 30388 774.18 32700 831.35 32578 898.04 33169 941.7
Haryana 30181 693.54 33815 769.41 36546 834.5 38976 970.23
Chandigarh 5895 178.02 5905 182.81 5977 194.54 5477 181.87
Jammu & Kashmir 3523 91.32 3672 93.26 3774 93 4160 105.89
Himachal Pradesh 10254 194.6 12282 248.81 13827 279.86 14535 311.34
Rajasthan 43160 875.71 49608 1018.09 53850 1122.1 58479 1304.76
WESTERN REGION 169524 4146.68 186269 4325.97 198923 5087.41 216641 5325.32
Gujarat 40520 1166.44 43780 1108.43 44221 1200.43 44661 1207.99
Maharashtra 125063 2882.58 138197 3122.21 150829 3789.26 167335 3995.13
Daman &Diu 440 13.57 245 4.11 97 2.89 624 17.12
Goa 3362 80.57 3481 84.31 3588 89.29 3810 99.07
Dadra & Nagar Haveli 139 3.52 566 6.9 188 5.54 211 6.01
SOUTHERN REGION 1165397 19401.18 1353076 22416.5 1458356 25234.93 1477479 27721.54
Andhra Pradesh 215832 4761.77 218054 5008.1 213281 4988.98 154765 4022.32
Karnataka 156179 2814.7 167291 3103.71 167517 3402.17 179571 3633.15
Lakshadweep 14 0.16 15 0.23 24 0.36 230 3.7
Tamilnadu 555223 7111.79 689094 9234.2 786634 11265.55 831651 13043.35
Kerala 228395 4576.67 267703 4903.62 278992 5376.3 296992 6743.6
Pondicherry 9754 136.09 10919 166.64 11908 201.57 14270 275.42
TOTAL 1911423 35854.67 2211544 41341.84 2373103 46727.48 2508947 52982.25

Source: RBI. **
Source: PSBs (Data is Provisional)

The above detailed information was submitted by the Minister of State for Finance Shri. Namo Narain Meena in the Lok Sabha on 8th March, 2013.

Be the first to comment - What do you think?  Posted by admin - March 19, 2013 at 3:10 pm

Categories: Loan   Tags: , , , , ,

Home Loan Interest Rates : Different rate of interest on home loans charged by banks

Home Loan Interest Rates : Different rate of interest on home loans charged by banks…
Minister of State for Finance replied to a question in Lok Sabha on 22nd February 2013 regarding rate of interest on home loans being charged by various Scheduled Commercial Banks is given below…
Interest rates on advances have been de-regulated by the Reserve Bank of India (RBI). The banks determined their actual lending rates on loans and advances with reference to their Base Rate and by including such other customer specific changes as considered appropriate.
As per the guidelines of RBI, Base Rate system has been introduced in the banks with effect from 01.07.2010 and all loans sanctioned/ disbursed on or after 01.07.2010 are linked to the Base Rate. Since Base Rate arrived at by banks is based on cost of funds and various other factors of respective banks, the Base Rate of individual banks varies. Since interest rates of housing loans are linked to the Base Rate, there is variation in interest rates offered by various banks.
There is no such proposal to issue instructions to all the banks to offer home loans to the consumers at a uniform rate of interest.
The complete details of present rate of interest being charged on home loans by different banks is annexed below…

 

Sl. Name of the Bank As on January 10, 2013 (In %)
No Minimum Maximum
1 Allahabad Bank 10.2 10.95*
2 Andhra Bank 10.5 11.75
3 Bank of Baroda 10.75 12.25
4 Bank of India 10.5 10.75
5 Bank of Maharashtra 10.5 12.25
6 Central Bank of India 10.25 10.5
7 Corporation Bank 10.5 11
8 Canara Bank 10.5 10.75
9 Dena Bank 10.45 11.75
10 Indian Bank 10.5 12
11 Oriental Bank of Commerce 10.4 11
12 Punjab National Bank 10.5 11.25
13 State Bank of India 10 10.15
14 Vijaya Bank 10.25 11.25*
15 Union Bank of India 10.5 13.25*
16 IDBI 10.25 11.50*
17 Indian Overseas Bank 10.25 11.25*
18 Punjab and Sindh Bank 10.5 11
19 State Bank of Bikaner & Jaipur 10.4 10.5
20 State Bank of Hyderabad 10.25 10.25
21 State Bank of Mysore 11 12
22 State Bank of Patiala 10.5 12.75
23 State Bank of Travancore 10.25 10.5
24 Syndicate Bank 10.5 12
25 UCO Bank 10.2 10.20*
26 United Bank of India 10.7 11
* as on 19.02.2013.

Be the first to comment - What do you think?  Posted by admin - March 12, 2013 at 4:50 pm

Categories: General news, Loan   Tags: , , , , ,

Central Government: Employees: Interest Subvention of 1% on housing loans

Interest Subvention of 1% on housing loans

The Union Cabinet today approved the proposal for extending the scheme of interest subvention of 1% on housing loans upto Rs.15 lakh where the cost of the house does not exceed Rs.25 lakh for the year 2012-13 and to amend the operational part of guidelines for release of funds.

A budgetary provision of Rs.400 crore has been made for Financial Year 2012-13 for implementing the scheme.

Consequent upon the extension of scheme, the limit of subsidy for an individual borrower would be Rs.14,912 for a loan of Rs.15 lakh and Rs.9925 for a loan of Rs.10 lakh.

The extended scheme will benefit all house loans availed in Financial Year 2012-13.

Background:

The original scheme of 1% Interest Subvention on Housing Loans upto Rs.10 lakh, provided the cost of the housing unit does not exceed Rs.20 lakh was approved by the Cabinet in September, 2009. The scheme was revised by iberalizing the limit of housing loan upto Rs.15 lakh where cost of house does not exceed Rs.25 lakh in financial year 2011-12 which was approved by the Cabinet in October 2011. The scheme is further extended for another year that is financial year 2012-13. National Housing Bank (NHB) is the nodal agency for implementing the scheme both for Scheduled Commercial Banks and Housing Finance Companies.

Source: Pib

Be the first to comment - What do you think?  Posted by admin - July 6, 2012 at 4:46 am

Categories: Loan   Tags: , , ,

Rate of interest on Loans and Advances sanctioned by the State Government – Interest rates for the year 2012-2013 – Orders – Issued.

GOVERNMENT OF TAMIL NADU
                    2012

FINANCE (LOANS AND ADVANCES CELL) DEPARTMENT
G.O.No. 203, Dated 8th June 2012
(Vaikasi 26, Thiruvalluvar Aandu 2043)

INTEREST – Rate of interest on Loans and Advances sanctioned by the State Government – Interest rates for the year 2012-2013 – Orders – Issued.

READ – the following paper:

G.O. Ms. No.131, Finance (Loans and Advances Cell) Department, dated 5-5-2011.

ORDER:

Government direct that the rate of interest on various kinds of loans and advances by the State Government during the year 2012-13 shall be as shown below:-


Sl. No.

 

Class of Loan / Advance

Percent per annum for the year 2012-2013

1.

 

Loans to State owned Industrial / Commercial Undertakings / Corporations, etc. including Financial Corporations and all other Local Bodies and Municipal Corporations:

 
  (a) Plan Schemes for development purposes 

10.50

  (b) Other Schemes

11.50

  (c) For capital formation and development purposes

11.00

  (d) For Working Capital Support

13.50

  (e)

For Ways & Means advances, advances including loans to cover cash deficits

13.00

  (f)

For Ways & Means advance to Tamil Nadu Civil Supplies Corporation Limited for Public Distribution System

10.00

Sl. No.

 

Class of Loan / Advance

Percent per annum for the year 2012-2013

2.

 

Loans to Co-operative Institutions and Co-operative Banks like Land Development Bank

10.00

3.

  Loans to Government Servants   
  (i) House Building Advance:  
    (a) For loans upto Rs.50,000/- 

5.50

    (b) For loans from Rs.50,001/- to 1,50,000/-

7.00

    (c) For loans from Rs.1,50,001/- to 5,00,000/-

9.00

    (d)  Above Rs.5,00,000/-

10.00

  (ii) Conveyance Advance:  
    (a) For purchase of Motor car

11.50

    (b) For purchase of Motor Cycle / Scooter

9.00

    (c) For purchase of Bi-cycle

5.50

  (iii) Other Personal Loans to Government Servants:  
    (a) For purchase of Computer

10.00

    (b) Others

10.00

4.

  Other items:  
   

Loans which are not covered in any specific category mentioned above

12.50

5.

 

Value of seized stock under Essential Commodities Act, 1955

9.15

6.

  Penal Interest

2.50

   2. The above rates will be applicable for all loans and advances being sanctioned during the year 2012-2013 and will have validity till the next revision is done. 

   3.  The rates of interest are general and will not apply to cases where reduced rates of interest have been sanctioned specially by the Government or where loans have been sanctioned by the Government free of interest.  The Government may also sanction Ways and Means advances at special rates of interest taking into account, the cost of borrowing of the Government.

   4.  The mobilization advances to Contractors for World Bank assisted Projects wherein the standard bidding documents provide for  exemption from paying of interest are however exempted from payment of interest.
 
   5.  The penal interest on all overdue instalments of principal and interest will be at 2.50 per cent more than the normal rates of interest per annum.  

   6.  Except in the case of loans to Government Servants, interest in all cases unless specifically indicated otherwise should be paid every Calendar quarter on the outstanding balance.

   7.  Even at the stage of sanction of loan, in the sanction order, the period of repayment, rate of interest and schedule of repayment with dates shall be indicated.  In case, it is a permanent loan, a specific mention of this fact should be made in the sanction order itself.

(BY ORDER OF THE GOVERNOR)

       K. SHANMUGAM
PRINCIPAL SECRETARY TO GOVERNMENT

Source:http://www.tn.gov.in/gosdb/gorders/finance/fin_e_203_2012.pdf

Be the first to comment - What do you think?  Posted by admin - June 18, 2012 at 6:31 am

Categories: Loan   Tags: , ,

Foreclosure charges / Pre-payment penalties on Housing Loan

Foreclosure charges / Pre-payment penalties on Housing Loan

Pre-Payment Penality on Home Loans
Reserve Bank of India (RBI) in its monetary policy, during 2012-13 has announced not to permit banks to levy foreclosure charges/pre-payment penalties on home loan on a floating interest rate basis.
Further, National Housing Bank (NHB) which regulates the Housing Finance Companies (HFCs) have advised them not to levy pre-payment charges on the borrowers where the housing loan is on floating interest rate basis. Further, NHB has also advised the HFCs not to levy any pre-closure charges even where the housing loan is on fixed interest rate basis and the loan is pre-closed by the borrowers out of his own sources.
This information was given by the Minister of State for Finance, Shri Namo Narain Meena in written reply to a question in Lok Sabha today.

Be the first to comment - What do you think?  Posted by admin - June 13, 2012 at 1:00 pm

Categories: Loan   Tags: , , , , , , ,

Stop charging prepayment penalty on home loans: RBI to banks

Stop charging prepayment penalty on home loans: RBI to banks
In a relief to borrowers, the RBI on Tuesday  asked banks to immediately stop charging penalty on pre-payment of home loans taken on floating interest rates.
“It has…been decided that banks will not be permitted to charge foreclosure charges\pre-payment penalities on home loans on floating interest rate basis, with immediate effect,” the Reserve Bank said in a communication to banks.
The RBI noted that the Damodaran Committee had observed that foreclosure charges levied by banks on prepayment of home loans were resented by home loan borrowers.
This is particularly so considering that banks were found to be hesitant in passing on the benefits of lower interest rates to the existing borrowers in a falling interest rate scenario, it added.
“As such, foreclosure charges are seen as a restrictive practice deterring the borrowers from switching over to cheaper available source,” the RBI said.
The removal of the charges or penalty, the RBI said, will lead to reduction in the discrimination between existing and new borrowers and competition among banks will result in finer pricing of the floating rate home loans.
“Though many banks have in the recent past voluntarily abolished pre-payment penalties on floating rate home loans, there is a need to ensure uniformity across the banking system,” it added.
Some banks were charging pre-payment penalty of 1-2 per cent of the outstanding loans.
With an aim to ensure uniformity across the banking system in home loan segment, the RBI in the annual monetary policy for 2012-13 had proposed “not to permit” banks to levy the charges.
It had said that detailed guidelines in this regard would be issued separately.
Last year, a consensus was reached at the Banking Ombudsmen Conference that banks should not impose pre-payment charges on loans with a floating rate of interest.
Earlier, housing finance regulator National Housing Bank (NHB) had directed all housing finance companies to desist from imposing a pre-payment penalty.
Source: DDI News

Be the first to comment - What do you think?  Posted by admin - June 10, 2012 at 2:45 pm

Categories: Loan   Tags: , , ,