New Delhi: Ujjivan Small Finance Bank, a wholly owned subsidiary of Ujjivan Financial Services Limited, has launched Overdraft (OD) facility for Micro and Small Enterprises (MSE) customers across all bank branches nationally. The facility is an add-on product to the existing MSE term loans offered by the bank.
The OD facility is offered to all MSEs with a turnover of INR 50 lakhs or more at a competitive rate of interest. This interest rate is for one year with a credit limit between a minimum INR 11 lakhs to a maximum of INR 50 lakhs which can be renewed on an annual basis.
One of the key features of this facility allows the MSE customers to pay EMI only on the utilised amount and repay the amount anytime during the tenure of the OD facility to replenish the credit limit back to its original amount. This special feature empowers the MSE customers availing the credit limit to manage their cash flows smartly and more efficiently and is designed keeping in mind that loans to this segment are better left flexible considering the dynamic and variable funding requirements their businesses have.
Ujjivan SFB also offers composite loans where the overdraft facility can be combined with existing MSE term loan products. This helps the customers to take care of their long term and short term business requirements.
Speaking on the announcement, Banks’s Managing Director & CEO Samit Ghosh said , “This offering is aimed at the MSEs who don’t have easy access to formal credit given their turnover limitations. With this facility, we now offer a complete range of formal banking solutions to MSEs to meet all their business needs. The existing product offering of Ujjivan for the MSE customers is in the form of term loans. Given the requirement of funds for working capital purposes, and sometimes for short term purposes, Overdraft limits would help the customers to meet the fluctuating requirements of working capital throughout the year,”
Ujjivan Small Finance Bank (Ujjivan SFB) started its banking operations in February 2017. Today, with 300+ branches, Ujjivan SFB has established its presence across 24 States and Union Territories.