Kotak Bank - 16.00% for Banking Services - MSME & SME (OD/CC) Loan
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Last updated: 19 Sep 2025, 01:49 PM
Kotak Mahindra Bank MSME & SME Overdraft (OD)/Cash Credit (CC) Loan: Flexible Working Capital for Growth
Kotak Mahindra Bank Limited, a leading private sector bank headquartered in Mumbai, offers Overdraft (OD) and Cash Credit (CC) facilities under its business loans portfolio, including MSME-specific schemes like collateral-free working capital finance. These revolving credit lines enable Micro, Small, and Medium Enterprises (MSMEs/SMEs) to access funds up to a sanctioned limit, with interest only on the utilized amount—ideal for managing day-to-day operations, inventory, or receivables.
In-Depth Details
Key Highlights
- Products Offered:
- Working Capital Finance (CC/OD): Fund-based facilities including cash credit, overdraft, term loans, bills/invoice discounting, and loan against property; tailored for MSMEs with turnover up to ₹250 crore.
- Special Schemes: Agri-SME Business Loans for commodity traders (e.g., wheat, soyabean); Loans Against Credit Card Receivables or POS transactions; collateral-free options under CGTMSE (Credit Guarantee Fund Trust for Micro and Small Enterprises) up to ₹2 crore; integrated with PMMY (Pradhan Mantri Mudra Yojana) for micro units.
- 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 financials and turnover.
- Tenure: Revolving (1-3 years, renewable annually); flexible repayment tied to cash flows; moratorium up to 6 months for eligible units.
- Interest Rates (as of September 2025): Starting from 16% p.a. (linked to Repo Rate + spread, up to 18-20% based on risk); concessions of 0.25-1% for women entrepreneurs, priority sectors, or strong credit profiles; effective rates as low as 12.75% p.a. for select overdraft variants.
- Eligibility Criteria:
- Business vintage: Minimum 1-3 years.
- Annual turnover: ₹10 lakh to ₹250 crore (MSME via Udyam: Micro <₹5 crore, Small <₹50 crore, Medium <₹250 crore).
- Credit score: CIBIL 700+ preferred; positive cash flow and Udyam registration required.
- Sectors: Manufacturing, trading (e.g., agri-commodities), services (excluding speculation); priority for SC/ST, women-led, or rural businesses.
- Collateral: Optional (CGTMSE covers 75-85% for loans up to ₹2 crore); accepts property, receivables, or FDs.
- Features & Benefits:
- Interest only on drawn amount for optimized costs.
- Quick drawdown via cheques, ECS, or digital modes.
- Digital application and tracking via Kotak Net Banking/app; turnaround time: 7-15 days.
- No processing fees for small loans (<₹1 lakh); overdraft against securities or infrastructure finance add-ons.
- Additional perks: Invoice financing via GSTN, forex support, and composite limits combining OD with term loans.
- Required Documents:
- KYC: PAN, Aadhaar, address proof.
- Business: Udyam certificate, GST returns/ITR (last 2 years), profit & loss/balance sheets.
- Financials: Bank statements (6-12 months), projected cash flows.
- Collateral (if applicable): Property/receivables documents.
