Bank of India - 8.50% for Banking Services - MSME & SME (OD/CC) Loan
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Last updated: 19 Sep 2025, 01:48 PM
Bank of India MSME & SME Overdraft (OD)/Cash Credit (CC) Loan: Empowering Business Growth
Bank of India (BOI), a leading public sector bank headquartered in Mumbai, offers flexible Overdraft (OD) and Cash Credit (CC) facilities under its MSME and SME banking portfolio, including schemes like Star MSME Loan and CGTMSE-backed options. These revolving credit lines support working capital needs for Micro, Small, and Medium Enterprises (MSMEs/SMEs), allowing withdrawals up to a sanctioned limit with interest only on the utilized amount—ideal for inventory, payroll, or seasonal cash flows.
In-Depth Details
Key Highlights
- Products Offered:
- Star MSME Loan (Working Capital): Collateral-free or secured OD/CC up to ₹2 crore under CGTMSE; includes composite limits for term loans and working capital.
- SME Working Capital Finance: Customized CC/OD for SMEs with turnover up to ₹250 crore; options for export credit, supply chain finance, and vendor financing.
- Government tie-ups: PMMY (Pradhan Mantri Mudra Yojana) for micro units and Credit Guarantee Fund Trust for Micro & Small Enterprises (CGTMSE) for risk coverage up to 85%.
- Loan Amount: ₹50,000 to ₹5 crore (collateral-free up to ₹2 crore under CGTMSE); higher limits (up to ₹25 crore) for secured SME facilities based on turnover and financials.
- Tenure: Revolving (1-3 years, renewable annually); no fixed repayment—adjustable per cash flow; moratorium up to 6 months for new units.
- Interest Rates (as of September 2025): Linked to Repo Rate (6.50%) + spread; starting from 8.50% p.a. for MSMEs (up to 11% for higher risks); concessions of 0.25-1% for women entrepreneurs, priority sectors, or high credit scores. CGTMSE-backed loans at concessional rates (e.g., 4% effective under ISEC for khadi units).
- Eligibility Criteria:
- Business vintage: Minimum 1 year (3 years for unsecured).
- Annual turnover: ₹10 lakh to ₹250 crore (MSME classification per Udyam portal: Micro <₹5 crore, Small <₹50 crore, Medium <₹250 crore).
- Credit score: CIBIL 700+ preferred; positive cash flow and Udyam registration mandatory.
- Sectors: Manufacturing, trading, services (excluding real estate/speculation); priority for women-led, SC/ST, or rural units.
- Collateral: Optional (CGTMSE covers up to 85% for loans ≤₹5 lakh; 75% for ₹5-200 lakh); accepts property, stocks, or FDs.
- Features & Benefits:
- Interest only on drawn amount for cost savings.
- Quick drawdown via cheques, ECS, or digital modes.
- Digital monitoring via BOI Mobile App; turnaround time: 15-30 days.
- Guarantee cover reduces lender risk; no processing fees for loans <₹1 lakh.
- Additional perks: Overdraft against TDRs, forex facilities, and integration with GSTN for invoice financing.
- Required Documents:
- KYC: PAN, Aadhaar, address proof.
- Business: Udyam certificate, GST returns (last 2 years), ITR/profit & loss statements.
- Financials: Bank statements (6-12 months), projected turnover/cash flows.
- Collateral (if any): Property deeds or asset valuations.
