Every financial dealings involve risk and there is no exemption in lending money to public. Bank calculates their risk factor in each and every loan products hence making ways to subdue collecting authenticated documents from its loan customers. Here we can find what are the documents usually banks ask to a loan customer. Please note that the list is only indicative and not exhaustive, and depending upon the local requirements at different places addition could be made as per necessity.
1. Customer Identity Proof (Any one from the list below)
- Voter ID Card
- Driving License
- PAN Card
- Signature identification from present bankers of proprietor, partner or Director (if a company)
2. Customer Residence Proof (Any one from the list below)
- Recent telephone bill
- Electricity bill
- Property tax receipt
- Voter ID Card of proprietor, partner or Director (if a company)
3. Business Address Proof (Any one from the list below)
- Copies of relevant License
- Registration Certificates
- Lease or Rent agreement
- Other Documents pertaining to the ownership
- Identity of address of business unit
4. Proof of Minority (If applicable)
- SC / ST / OBC / etc..
5. Balance Sheet
- Last three years balance sheets of the units along with income / sales tax returns etc. (APPLICABLE FOR ALL CASES FROM RS. 2 LAKHS AND ABOVE). However, for cases below fund-based limits of Rs. 25 lakhs if audited balance sheets are not available, then unaudited balance sheets are also acceptable as per extant instructions of the bank. For cases of Rs. 25 lakhs and above, the audited balance sheets are necessary.
6. Company / Partnership Deed (if applicable)
- Memorandum of Association
- Articles of Association
- Assets and liabilities statement of promoters and guarantors along with latest income tax returns.
- Rent Agreement (if business premises on rent)
- Clearance from pollution control board if applicable
- SSI registration if applicable
- Projected balance sheets for the next two years in case of working capital limits and for the period of the loan in case of term loan. (APPLICABLE FOR ALL CASES FROM RS. 2 LAKHS AND ABOVE)
- In case of takeover of advances, sanction letters of facilities being availed from existing bankers / Financial Institutions along with detailed terms and conditions
- Profile of the unit (includes names of promoters, other directors in the company, the activity being undertaken, addresses of all offices and plants, shareholding pattern etc. (APPLICABLE FOR CASES WITH EXPOSURE ABOVE Rs. 25 LAKHS)
- Last three years balance sheets of the Associate / Group Companies (If any). (APPLICABLE FOR CASES WITH EXPOSURE ABOVE Rs.25 LAKHS)
- Project report (for the proposed project if term funding is required) containing details of the machinery to be acquired, from whom to be acquired, price, names of suppliers, financial details like capacity of machines, capacity utilization assumed, production, sales, projected profit and loss and balance sheets for the next 7 to 8 years till the proposed loan is to be paid, the details of labour, staff to be hired, basis of assumption of such financial details etc. (APPLICABLE FOR CASES WITH EXPOSURE ABOVE Rs. 25 LAKHS)
- Review of account containing month wise sales (quantity and value both), production (quantity and value), imported raw material (quantity and value), indigenous raw material (quantity and value), value of stocks in process, finished goods (quantity and value), debtors, creditors, bank's outstanding for working capital limits, term loan limits, bills discounted. (APPLICABLE FOR CASES WITH EXPOSURE ABOVE Rs. 25 LAKHS)
- Photocopies of lease deeds / title deeds of all the properties being offered as primary and collateral securities
- Position of accounts from the existing bankers and confirmation about the asset being Standard with them (In case of takeover)
- Manufacturing process if applicable, major profile of executives in the company, any tie-ups, details about raw material used and their suppliers, details about the buyers, details about major competitors and the company's strength and weaknesses as compared to their competitors etc. (APPLICABLE FOR CASES WITH EXPOSURE ABOVE Rs. 25 LAKHS).