Loan terms & conditions

Funding Pattern - The funding support under the scheme will be in the form of interest bearing loan.

  • Loan Component – 80% (maximum)
  • End Borrower’s Contribution - 20% (minimum)

Tenure of loan & moratorium period - Tenure of loan would be a maximum of 10 Years, from the date of the 1st release, including moratorium period of a maximum 2 years on repayment of principal only (moratorium period will be for the project and not for each release).

Interest Rate – The rate of interest to End Borrowers would be 6.5% per annum (or as decided by NDDB from time to time) and will be effective throughout the repayment period. Interest will be calculated on daily product basis without compounding.

Commitment Charges - If cumulative disbursement at the end of a quarter is less than 90% of the pre-approved cumulative draw-down schedule, the End Borrower will have to pay a commitment charge of 2% per annum (or at such rate as may be conveyed by NDDB from time to time) with applicable taxes on the cumulative difference between the projected drawdown schedule and actual disbursement. It will be levied from the beginning of the next quarter till the differential amount is withdrawn.

Security Arrangement for loan –The End Borrower shall have to provide State Government Guarantee for repayment of loan under DIDF.

Loan Swapping - Loan available from other financial institutions for the projects under execution can be considered for loan swapping under DIDF scheme subject to fulfilling the following pre-conditions:

  • Eligible End Borrower should obtain No Objection Certificate (NOC) from concerned financial institution/ funding agencies.
  • Eligible End Borrower will have to qualify for all eligibility criteria defined under the DIDF scheme.
  • No cases / disputes should be pending in the court of law in relation to the project under consideration.
  • Reassessment of project cost estimated, procurement (purchase) procedures and viability as per the terms and conditions of the DIDF scheme.
  • Assessment of capability of Eligible End Borrower to provide adequate security including State Government guarantee.

Other Lending Terms

  • The loan will be sanctioned to the eligible End Borrower against State Government guarantee. SPSRC shall have to secure the commitment letter from State Government for providing guarantee on behalf of the eligible End Borrower.
  • The eligible End Borrower will have to create Debt Service Reserve Account (DSRA) immediately after the fund is disbursed to the eligible End Borrower. The eligible End Borrower shall maintain DSRA covering minimum of 2 quarter interest and principal instalments.
  • The eligible End Borrower will have to achieve the targets as prescribed in efficiency and output parameters by NDDB under the scheme.
  • A bilateral agreement will be signed between NDDB and eligible End Borrower.
  • The End Borrower will have to give consent/causes to give consent for assigning the securities offered to NDDB under DIDF, in favour of NABARD.
  • The State Government shall have no objection for assignment of the guarantee provided under the scheme to the third party by NDDB.

The End Borrower will have to sign transparency covenant for all the suppliers/contractors.