SUMMER INTERNSHIP PROJECT REPORT

ON

“A STUDY ON THE VARIOUS ASPECTS OF

BUSINESS LOAN”

Submitted for the partial fulfillment of the requirement for the

award of
POST GRADUATE DIPLOMA IN MANAGEMENT

SUBMITTED BY: UNDER THE GUIDANCE OF:

Anurag Yadav Industry Mentor- Mr. Ayush Jain

Roll. No. –2016027 (Credit Manager)

Batch (2016-18) Faculty Mentor- Prof. Neetu Purohit

(Assistant Professor)

INSTITUTE OF TECHNOLOGY & SCIENCE, MOHAN NAGAR,

GHAZIABAD
SESSION: 2016-2018
 DECLARATION

I hereby declare that this project work entitled “A study on the various aspects of
business loan is my work, carried out under the guidance of my faculty guide Prof.
Neetu Purohit and my company industry mentor guide Mr. Ayush Jain . This
report neither full nor in part has ever been submitted for award of any other
degree of either this university or any other university.

Date: 20/07/2017 Submitted by:

Place: Ghaziabad. Anurag yadav

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 CERTIFICATE OF ORIGINALITY

This is to certify that the Summer Internship Project titled “A study on the various
aspects of business loan”, a bonafide work of Anurag yadav is original and has
been done under my supervision in partial fulfillment of the requirement for the
award of PGDM for the period of two months from12, May 2017 to 05, July 2017.
This report neither full nor in part has ever before been submitted for awarding of
any degree of either this university or any other university. I am pleased to say that
her performance during the period was extremely satisfactory.

Industry Mentor
Mr. AYUSH JAIN
Credit Manager Of the Company
Loan frame Pvt. Ltd

3
 CERTIFICATE

This is to certify that Mr Anurag yadav PGDM (2016-18 Batch) a

student of I.T.S- Institute of Management, has undertaken the project on
“A Study On The Various Aspects Of Business Loan”. The survey, data
collection, & analysis work for preparing the project has been carried
out by the student in partial fulfillment of the requirements for the award
of PGDM, under my guidance and supervision.

I am satisfied with the work of Mr. Anurag yadav

Date: 22/07/2018 Faculty Mentor’s Name

Prof. Neetu Purohit

(Signature)

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 ACKNOWLEDGEMENT

I would like to give our sincere gratitude towards our institute "Institute of
Technology and Science" which gave us an opportunity to prepare my project &
Training from "Loan frame pvt. Ltd." in my desired field.

I would like to thank Mr. Ayush Jain Credit Manager, loan frame Private Limited
for interviewing me and giving me an opportunity to prepare that project.

My Project could not have been completed without the humble support and
cooperation of the whole team of loan frame Pvt.. Ltd., especially Mr. Ayush Jain
, Mr. Mahesh giri.

Date : Anurag yadav

Place :Gurugram

5
 EXECUTIVE SUMMARY

The objective of my Project was not only to find out the " A study on the various
aspects of business loan used by the loan frame " for different type of customer
but also I have gone through the whole process of business loan.

The research method I used for the study was Conclusive-Descriptive through
which I have done depth study in the work area, at my level best, with the Primary
and Secondary data collection method.

After the analysis of all the data instruments like questionnaire and tele-calling we
come to know that more number of customers are salaried and are the employed of
Private Sector, apart from this many of the customers are self employed
professionals and non professional. Some of them are in the category of no income
proof and low income. Each is solved with the different methods.

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 Table of Contents

Sr. No Contents

1. Declaration
2. Certificate of originality
3. Acknowledgement
4. Executive summary
5. Introduction 8-9
6. Business Loan process and steps 10-11
7. Features 12
8. Types of Business Loan 13-16
9. Need for Business Loan 16
10. Business Loan Advantages 17
11. Disadvantages 18
12. Benefits 19-20
13. Purpose 21
14. Eligibility 21
15. Range at Loan Frame 22
16. Loan Products 23
17. Introduction of Business Loan type in India 24-26
18. Introduction to the company 27-28
19. Company Details 28-30
20. Amenities 31-42
21. Competitors 43-45
22. Research objective 46
23. Scope of Study 47
24. Research Methodology 48
25. Data Analysis 49-62
26. Finding 63
27. Recommendations 64
28. Limitations Of the study 65
29. Conclusion 66
30. Questionnaire 67-69

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 INTRODUCTION

Business loans are provided based on the market value, mainly estimation given by banks or the
registration value of the property. Availing various types of business loans to suit your
individual needs at the lowest rates & easy financing can now fulfill the need for a Business of
your own.

Business is not a one-time decision; do review the market periodically before availing them.

Today there are unlimited numbers of banks in the country wanting to give out . Given this
scenario, it may seem easy getting yourself a loan. But is it really??

Buyers tend to make mistakes while entering into deals, which may not be beneficial for them, so
better compare all the variables before signing a loan agreement by different banks. Nowadays
business man don’t have to worry much about the source of money for their loans . Business
loans have made the life of business man much easier. But loan taker should be very careful
when choosing a business loan. Before doing anything else, borrowers should make a thorough
research of the current interest rates in the market, and then opt or go for any business loan
. Buyers could even go form business loan , by undertaking mortgages. This way, the borrowers
can get a loan after pledging or securing any asset or securities of their own, against amount of
money borrowed by them.

Business Loan is a Secured Loan offered against the security of a house/property which is
funded by the bank’s loan, the property could be a personal property or a commercial one. The
Business Loan is a loan taken by a borrower from the bank issued against the property/security
intended to be bought on the part by the borrower giving the banker a conditional ownership over
the property i.e. if the borrower is failed to pay back the loan, the banker can retrieve the lent
money by selling the property.

8
However the loan agreement should be finalized only after reading the terms and conditions
carefully. You can apply for a Business loan even before you select your property. The loan
amount would be sanctioned or approved for you, based on your repayment capability.

A first priority for a youngster who begins life is therefore to plan for a business. This takes
precedence over other household expenditure and creature needs.

Business , however, is a major expenditure and cannot be funded out of a family's normal
monthly income or savings.

The prospective homeowner must look for a loan substantial in size and so structured that he can
repay it over a longer period of time, in many cases almost one's entire working life.

Loan is offered to a borrower to purchase or build a running business on the basis of is/her
eligibility and the loan frame lending rules. One of the important bases .

Withthe overall encouragementgiven to this sector, a number of players entered in Business

finance .One of the most important benefits of taking a business loan is the interest rate that is
allowed on the business loan. Fixed and

variableinterest rate options are also available for business loans. Many financiers also offer
business improvement loans at the same interest rate as they offer the business loans.

Loan Frame Business Loans come to you on the solid foundation of trust and transparency built
in the tradition of Loan frame pvt.ltd. Best Practices followed in loan frame mentioned below
will tell you why it makes sense to do business with loan frame pvt.ltd
The loan frame offers business loans for purchase and/or construction of business loans. It
offers loans for buying resale Business and extension/ repair/ renovation/ alteration of an
existing Business .

9
Business Loan Process & various steps involved

There are various steps involved in getting a Business Loan from selecting your property to
filling up the loan application. Following are the various stages in Business Loan:

 Individual KYC:PAN,ID PROOF , UTILITY BILLS

 Business KYC; PAN, Business proof , utility bills
 Financials; Last 2 year ITR with computation and B.S .P&L
 Banking; Last 1 year S.b , C.A.,OD/CC
 Property papers ; Last 13 years chain , Mutation , GPA, Death certificate , tax receipts ,
 Existing loan Details ;soa ,so ,Amortization schedule ,Noc
 Business / company profile in detail

• Know the Business Loan Eligibility: Loan frame offer the loan amount only after checking
your profile & based on various eligibility criteria’s like age, income & salary banks lend you the
money.

• Select the Best Business Loan after evaluation: Comparing business loan interest rates is the
primary feature in the Business loan selection, however other fees & charges like Application
fees, processing fees, legal charges should not be neglected when comparing various loan offers.
To check the interest rates & other charges incurred by various banks, Loan frame has brought in
a business Loan Comparison Chart across various Banks.

• Applying for the Loan: After you have selected your lender, you have to fill in the application
form wherein the lender requires complete information about your financial assets & liabilities;
other personal & professional details together with the property details & its costs.

• Documentation & Verification Process: You are required to submit the necessary documents
to the loan frame which will be verified together with the details in the application.

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• Credit & default check: loan frame checks out the borrower’s loan eligibility (through
repayment capacity) & the amount of loan is confirmed. The borrower’s repayment capacity is
reached which is based on the income, salary, age, experience & nature of business etc. loan
frame also checks credit history through the Cibil Score which plays a critical role in deciding &
approving your loan application. Low Credit Score implies that the loan frame upfront rejects
your application on the basis of earlier credit defaults; on the other hand high credit score gives a
green signal to your application.

• Loan frame sanctions Loan & Offer letter to the borrower: After the credit appraisal of the
borrower , loan frame decides the final amount & sanctions the loan, the loan frame further
sends an offer letter to the borrower which constitutes the details like rate of interest, loan tenure
& repayment options etc.

• Acceptance Copy to the loan frame : The borrower needs to send an acceptance copy to the
loan frame after the borrower agrees with the terms & conditions in the offer letter.

• Loan frame checks the legal documents: The bank further asks the legal documents of
property from the borrower to check its authenticity so as to keep them as a security for the loan
amount given. The next step involved is the valuation of the property by the bank which
determines the loan amount sanctioned by the loan frame .

• Signing of agreement & the loan disbursal: The borrower signs the loan agreement & loan
frame disburses the loan amount.

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Features

 Provision for on the spot " In principle" approval.

 Loan sanctioned within 3 days of submission of required documents.
 Option to club income of your spouse and children to compute eligible
 Provision to club depreciation, expected rent accruals from property proposed to compute
eligible loan amount
 Provision to finance cost of furnishing and consumer durables as part of project cost
 Interest calculated on daily reducing balance basis, and starts from the date of
disbursement.
 Special scheme to grant loans to finance Earnest Money Deposits to be paid to Urban
Development Authority.
 Option to avail loan at the place of employment or at the place of construction

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 Types of Business Loan
There are different types of Business loans available in the market to cater borrower’s different
needs.

FIXED RENURE / TERM LOANS

A. LAP( Loan Against Property )

A loan against property (LAP) is a loan given or disbursed against the property mortgaged or
given as collateral. Here the underline assets / security is a property . the loan is given as a
certain percentage of the proprieties market value usually around 40% to 70% loan against
property is belong to the secured loan category ,where the borrower gives guarantee by using
his property as security . The loan is repaid in fixed monthly installments.AS it is backed by
security or collateral it attractes a lower interest rate and longer tenure up to 15 years .
Financing to individuals , partnerships , proprietorships, pvt .ltd. companies for there basic need
.
Criteria
1) Approved property shall be provided as a collateral
2) Can be given to self - employed , professionals ,partnerships
Requirement shall be any lawful activity and not for speculation
3) ROI and tenure will vary as per profile and requirement of customers

B. TERM LOAN

A term loan is a long term loan payable in monthly EMI;s and available for purchase of tangible
/ intangible assets fixed assets machinery equipment software etc. Term loans are also aimed at
your at your business expansion and acquisition of new assets .

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Criteria

1) The assets so acquired shall be for expansion of business

2) Borrower has to bring in margin as stipulated by lender

3) The assets shall be generated enough cash flows to repay the obligations

4) Term loan can be taken for a longer tenure payable in equal instalments as per
requirement of a borrow

5) Lander may ask for additional collateral in a way of property in order to finance the
asset .

C. Machinery and equipment payment

Funding specially for acquiring machines / equipments for your business unit . hypothecation on
machines will be created . cash flow for machines so acquired will be used to repay the loans.

1) Borrower has to bring in margin as stipulated by the lender

2) Payment will be made directly to the seller

3) Original invoice needs to be produced

4) The asset shall generated enough cash flow to repay the obligations

On can transfer his/ her existing loans and limits to any other bank of financial institutions for
various reasons like better rate , low charges , longer tenure and more top up . there should be at
least 12 months repayment track available

1) Standard repayment in the existing a/c

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 2) Top up will be based on your repayment track available and value of the security

3) Tenure can be increased or decreased as per requirement of the customer

4) All terms and conditions of original sanction will remain same .

5) Pre – payment Charges on the existing and prosessing fees on the new loan will be
applicable case to case basis.

2. Working capital limits .

E. CASH CREDIT

Cash credit facility are loans sanctioned in the form of limits . cc limit is sanctioned to meet day
to day requirement of Business . the under laying assets is the stock and book debt / receivables .

Criteria

DP or drawing power is based on your stock and book debt .

Cc limit can be available to meet day to day expenses of your business

It is renewed every year of tenure fixed by lender by submitting fresh stock statements .

OVER DRAFT

Over draft is a credit line financed against fixed assets to borrower this type of loan is available if
borrower wants a flexible usage of loan amount and don’t wants to be bounded by fixed .

Criteria

There has to be security property against which the loan is sanctioned .

One has to serve interest on the funds utilized or withdrawn .

Overdrafts are for business purpose only

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DROPLINE OVER DRAFT

This is another type of over draft in which the DP (Drawing power ) keeps reducing
proportionate to your principle payment of the limit if the loan is sanctioned for 10 years than at
the end of loan tenure the dp will become zero . one has 2 pay the interest only for the funds
utilized but there is a fixed principal payment .

NEED FOR BUSINESS LOANS

Few decades back, take a business loan was not a very easy task as there were hardly any
lenders available to loan the ever increasing astronomical lump sum of money. However, with
time, the rising property prices and the burgeoning business finance market in the country, made
the phenomenon of the business loan easy and the dream of starting business is possible.

Also, the BFC’s (Business Finance Companies) and banks have come up with so many business
loan plans that they have become an answer to every customer’s necessity. Apart from this, the
changing equation of market has also provided customers with several reasons to opt for a
business loan. Here are few reasons to why business loans have gradually became a necessity in
the society.

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 Business Loan Advantages

 Convenient and accessible– Banks are always accessible since they are used regularly for
depositing savings or withdrawing them. After being bank customers for years, the bank
becomes convenient and familiar, and personalized service makes it the first place to consider for
a loan.

 Multiple Loan options– All banks advertise various types of schemes to woo entrepreneurs
setting up or running a business. The real earnings for a bank come from the interest they charge
on these loans. Options like term loans, standard business loans and others are available for the
entrepreneur.

 Non profit sharing– Venture capitalists and angel investors agree to provide a loan in exchange
for part ownership, the right to influence decision making and a share of the profits. Banks do
not ask for any of these. If they do sanction a loan, they are only interested in getting their
interest and partial loan payment installments.

 Lower rates of interest-Though tough to get, banks provide loans at lower rates of interest than
other lending agencies and instruments like credit cards.

 Bank loans offer tax benefits– Small businesses taking loans from banks enjoy some relief
from tax, since the percentage of profits used to repay the loan is exempted from tax.
It is these advantages that prompt entrepreneurs to approach banks for one of the
various loans offered.

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 DISADVANTAGES

However, as mentioned before, getting a bank loan is not easy, and its disadvantages
include:

 Lengthy application process– banks need to verify all the credentials and details about the
business before sanctioning a loan. Therefore its application process is very long and its review
etc. takes a long time.

 Cumbersome– The prospect of getting into the detailing that banks require is really
cumbersome, and from the entrepreneur’s point of view, totally unnecessary.

 Preference given to existing, running businesses– banks prefer running businesses because
they can gauge its profitability and credit history before sanctioning the loan.

 Long list of prerequisites to qualify for the loan– banks have long list of conditions that a
business should fulfill before they clear the loan. It is sometimes not possible to meet all of them.

 Risk of losing Collateral– bank loans are generally sanctioned against some collateral, often the
entrepreneur’s house and property. This stands the risk of being lost to the bank should the
business fail to take off.

 Entire amount not granted– banks are known to not agree to grant the whole amount requested
for a loan. They may grant 70 or 80 % of the sum applied for. This makes it difficult for the
entrepreneur to begin since he has to scout around for the remaining balance and find agencies to
funs that before he can start.

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.Benefits :-

 Businesses require funding at various phases such as while starting on a new project,
expanding operations, or recovering from losses. However, starting up a business is the
part when funding seems to be almost non-existent. Entrepreneurs have to work out ways
to make optimal use of their resources in every possible way. But that may not be
enough. There are other ways to fund your business and one of the suitable ones is
a small business loan.

Acquiring a loan from your own bank seems easy but historically, only a few fortunate
ones get to avail the benefit of a small business loan. However, this scenario is changing
in India because of the encouragement to SMEs through multiple government policies
and schemes. Banks are also realising the unique potential of small and micro-businesses.
Small business loans help your business in many ways such as financing new equipment,
increasing your inventory, and funding expansion plans. Some other benefits of small
business loans are explained here.

Flexibility: You can choose from various types of loans to fulfil specific business
requirements. Various government schemes such as CGTMSE and other similar schemes
offer business loans that are designed for MSEs for starting, expanding, or upgrading the
facility. Government scheme such as CGTMSE does not require any security or third-
party guarantee. The guarantee cover is provided to the financial institution by the trust
itself.

Convenient Repayment: The flexible nature of business loans reflects in their

repayment options as well. Banks offers such flexibility because they understand the
complexities involved with businesses and their plans are designed accordingly. They
may offer a repayment plan as per the cash flow to avoid the difficulties in financial
management. Also, borrowers may increase or decrease the EMI as per the financial
condition of the company. They can also choose bullet payments for periodic repayment

19
Low Rates of Interest: Banks are different from private lending institutions and their
rates of interest are also lower. It happens mostly in the case of government-backed
schemes as they are designed for public welfare, not for the benefit of the financial
institution. Also, rates of interest are not determined just on the basis of the loan amount.
A number of factors are kept in mind such as tenure of the loan, viability of the business
model, financial condition of the company, and credentials of the borrower. Other costs
such as processing fee are nominal and are one-time expenses.

Easy Availability: Many banks, including some private lending institutions, offer small
business loans without collateral. This makes it easy for small entrepreneurs to avail such
loans and sustain their ventures. Also, EMI calculators and online applications provided
by most banks on their websites have made the process much easier than it used to be.

Grow Your Business: Finance, manpower, and technology are the essential needs of any
business. Among all of them, finance is a key aspect that makes it possible for a business
to ensure all the other needs are met. Thus, the required cash flow can be highly crucial
for expanding a business as it can be used for different purposes to grow your business.
You can arrange another facility or purchase required equipment to speed up your
business. In addition, owners also have the freedom to use the money as per their
preference. It enables them to utilise the funds according to the needs of the business.

Tax Benefits: Small business loans allow you to save some tax benefit as well. This is
because there are sections of the Income Tax Act that state the percentage of profit
utilised for repaying the loan amount is exempt from the tax.

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Purpose

 Purchase/ Construction of Business

 Extension/ repair/ renovation/ alteration of an existing Business
 Purchase of Furnishings and Consumer Durables as a part of the project cost.

Eligibility

 Minimum age 18 years as on the date of sanction

 Maximum age limit for a Business Loan borrower is fixed at 70 years, i.e. the age by
which the loan should be fully repaid.

CREDIT WITH DIFERRENCE

 Best lender customer match
 Enhance customer experience
 Product as per the requirement of the customer
 Speedy sanctions and disbursals
 Automation and utmost use of technology in the process
 Ownership of our clients
 Top ups and post sanction follow ups

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RANGE AT LOAN FRAME

PARAMETERS LOW HIGH

ROI 9.50% 24%
LTV 40% 150%
CIBIL 550 900
PROPERTY TYPE LALDORA , KHASRA , AUTHORISED , APPROVED
KHATAUNI , OPEN PLOTS
RELATIVE CHAIN

LOAN AMOUNT 1 LAC 25 CRORE

TENURE 12 MONTHS 15 YEARS
FOIR >40% 300%
SURROGATE NO 5 CR IN CASH INCOME , BANKING , DEBT

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LOAN PRODUCTS

LAP-Loan against property (9.5-13%)

Machinery finance (12-15%)
Term loan (12-15%)
Business loan (15-19%)
Working capital limits (10-14%)
Overdraft (lap+.5%)
Loans for professionals ( Doctors , C.A , Engineers ,
Architects ) ( 11.5-15%)
Balance take over & top up ( a better rate from
existing loan – up to 9.5%)

23
 INTRODUCTION
OF
BUSINESS LOAN TYPES IN INDIA

1. Bank loan

A bank loan may be obtained from a bank and may be either secured or unsecured.
For secured loans, banks will require collateral which may be lost if repayments
are not made. The bank will probably wish to see the business’s accounts, balance
sheet and business plan as well as studying the principals' credit histories. Many
smaller businesses are now however turning towards Alternative Finance
Providers, especially in the case of smaller firms.

Loans from credit unions may be referred to as bank loans as well. Business loans
from credit unions received the second highest level of satisfaction from borrowers
after loans from small banks.

2. SBA loans
The US Small Business Administration (SBA) does not make loans; instead it
guarantees loans made by individual lenders. The main SBA loan programs are
SBA 7(a) which includes both a standard and express option; Microloans (up to
$50,000); 504 Loans which provide financing for fixed assets such as real estate or
equipment; and Disaster loans. In FY 2016, total 7(a) volume was $11,967,861,900
and total 504 loan volume was $2,517,433,000.

24
 3. Mezzanine finance
Mezzanine finance effectively secures a company’s debt on its equity allowing the
lender to claim part-ownership of the business if the loan is not paid back on time
and in full. This allows the business to borrow without putting up other collateral,
but risks diluting the principals’ equity share in case of default.

4. Asset-based finance
Once considered the finance option of last resort, asset-based lending has become a
popular choice for small businesses lacking the credit rating or track record to
qualify for other forms of finance.[7] In simple terms, it involves borrowing against
one of the company’s assets, with the lender focusing on the quality of the
collateral rather than the credit rating and prospects of the company. A business
may borrow against several different types of asset, including premises, plant,
stock or receivables.

5. Invoice finance
In recent years, it has become increasingly difficult for SMEs to obtain
traditional finance from banks. Alternative options are invoice discounting or
factoring, whereby the company borrows against its outstanding invoices, with
the ability to obtain funds as soon as new invoices are created. It is often
questioned which option is best for your business – factoring or discounting –
and the answer depends on how the business wants to be perceived by
customers] With factoring, the finance company charges interest on the loan
until the invoice is paid, as well as fees, and the finance company takes
ownership of the debtor ledger and uses its own credit control team to secure
payment. With invoice discounting, the business maintains control of its own
ledger and chases debts itself.

25
 6. Microloans
Smaller loans, usually for loan amounts of $100,000 USD or less, are referred
to as “microloans.” Banks are less likely to make these loans than alternative
lenders. When they do, the decision is usually based on the personal credit
score of the business and/or the business credit score.

7. Online Lenders
There has been a rise in the number of online lenders offering small business
loans. Online alternative lenders originated an estimated $12 billion in small
business loans in 2014, with unsecured consumer loans representing $7 billion
and small business loans accounting for approximately $5 billion. ] Nonbank
lenders that make small business loans have doubled their outstanding portfolio
balance every year since 2000. Some online originate loans from their own
capital. Others may use a “marketplace” model, in which they match borrowers
to loan products from a variety of lenders. Others use crowd funding platforms
that allow businesses to raise capital from a wide variety of sources.

26
 INTRODUCTION TO THE COMPANY

Loan Frame Technologies Pte. $2.25 million Financing. Shailesh Jacob Published Jan 7 form
D
Loan Frame Technologies Pte. Ltd., just released form D announcing $2.25 million debt
financing. This is a new filing. Loan Frame Technologies Pte . was able to sell $2.05 million.
That is 91.11 % of the offering. The total financing amount was $2.25 million. This form was
filed on 2016-01-07. The reason for the financing was: Proceeds will be used for general
company purposes..
The fundraising still has about $200,000 more and is not closed yet. We have to wait more to see
if the offering will be fully taken.

Loan Frame Technologies Pte. is based in Singapore. The company’s business is not disclosed.
The form D was submitted by Shailesh Jacob Chief Executive Officer.

Analysis of Loan Frame Technologies Pte. Offering

On average, companies in the not disclosed sector, sell 67.77 % of the total offering amount.
Loan Frame Technologies Pte. sold 91.11 % of the offering. The fundraising is still open. Could
this mean that the trust in Loan Frame Technologies Pte. is high? The average financing size for
companies in all industries in our database is $3.05 million. The offering was 32.79 % smaller
than the average of $3.05 million. Of course this should not be taken as negative. Firms raise
funds for a variety of reasons and needs. The minimum investment for this offering was set at $0.
If you know more about the reasons for the fundraising, please comment below.

What is Form D? What It Is Used For

Form D disclosures could be used to track and understand better your competitors. The
information in Form D is usually highly confidential for ventures and startups and they don’t
like revealing it. This is because it reveals amount raised or planned to be raised as well as
reasons for the financing. This could help competitors. Entrepreneurs usually want to keep their
financing a ‘secret’ so they can stay in stealth mode for longer.

27
Why Fundraising Reporting Is Good For Loan Frame Technologies Pte .

The Form D signed by Shailesh Jacob might help Loan Frame Technologies Pte. Ltd.’s sector.
First, it helps potential customers feel more safe to deal with a firm that is well financed. The
odds are higher that it will stay in the business. Second, this could attract other investors such as
venture-capital firms, funds and angels. Third, positive PR effects could even bring leasing firms
and venture lenders.

Company Details

1. Overview

Loan Frame Technologies Pte . Ltd., Which listed its industry as other field a new form D
on January 07,2016.

Offering Details

 The total reported offering size was $2,250,000 USD.

 Of this amount, Loan Frame Technologies Pte. Ltd. sold $2,050,000 USD or (91.11% of the
offering), with the first sale occuring on December 07, 2015.
 The minimum investment for this offering was set at $0 USD.

Analysis of Offering

 On average, companies in this industry sell 74.33 percent of the total offering size. $200,000
USD was reported remaining.
 The average floor on investment size for companies in the Other industry is $0
 United States dollars.
 The method of investment was Debt and Convertible Promissory Notes.

28
Company Personnel

Executives, Directors and Promoters Disclosed in Filing

Company
Name Relationship Address

Mandarin Gardens
Shailesh Jacob  Executive Officer
 Director Singapore, U0 448909

Mandarin Gardens
Sushant Mantry  Director Singapore, U0 448909

Form D Filings in
Total
Amo
Total unt
Filing Filing Offering Raise
Company Date Type Amount d

$4,00

July $4,000
Cs Leasing 0
18, New
Holding Pte. United
2017 Unite
Ltd. States d
dollars States
dollar
s

29
 Total
Amo
Total unt
Filing Filing Offering Raise
Company Date Type Amount d

A $10
Indefinit
New Silk me
July 07, e MILLIO
Road China nd
2017 Offering N
(Us) Fund me
Size
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India Best
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2017 Size d
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s

30
Amenities:

 Fire Fighting Arrangements

 Club house

 Park

 Gym

 Swimming Pool

 Badminton Court

 Lifts

 Jogging Track

 Children's Play Area

 24 Hours Security

 24 Hours Power Backup

 Parking

 Rain Water Harvesting

 Party Hall

31
PROCESS OF BUSINESS LOAN

Sourcing is about to find out the potential lead for which produces a profitable business for
an organization.

Sanction

 First of all your loan will be approved after getting complete documents with
completely filled application form & processing fee cheque.

 In the process of sanction, all your income documents are verified, a CIBIL(credit
investigation )report is generated, both app.& co-app. Residence & office
verification is done.

 After getting all the reports ok, a sanction letter is generated which is sent at your
residence by courier as well as you will get a message on your mobile

Cheque Fixing

Immediate after sanction of your loan, we need the following property docs for making the
pay order

Property papers for direct builder allotment

 Disbursement request form

 Allotment Letter (original)

 Demand Letter (original)

 Permission to mortgage (original)

32
  Own contribution receipts (original)

 Tripartite Agreement (original) - on Rs.100/- stamp paper -2 sets xerox copy

 Indemnity Bond (original) on Rs.100/- stamp paper duly notarised

Note: Kindly keep the photocopy of all the docs with you

33
List of Documents Required For BUSINESS LOAN

Checklist of documents to be obtained in respect of Applicant

Complete loan Application

1. 3 passport size photographs

2. Proof of identity (Electoral ID card/Passport/driving license/PAN card)

3. Proof of residence (Electoral ID card/Passport/Electricity/Telephone bill)

4. Statement of Bank account for the last six months

5. Personal Assets and Liabilities statement on bank’s standard format

GUARANTOR

Personal assets and Liabilities statement

1. 2 passport size photographs

2. Proof of identification (Electoral ID card/Passport/driving license/PAN card)

3. Proof of residence (Electoral ID card/Passport/Electricity/Telephone bill)

4. Proof of Income as per Salaried/Self Employed(Given Below)

5. Proof of assets – Copy of Registry/House Tax Receipt & details of investments

INCOME DOCUMENTS: FOR SALORIED APPLICANTS

 Original salary certificate for the last month/ salary slip for last 3 months/ sic

 TDS certificates- Form 16 and copy of I.T. return for the last two financial years,
duly acknowledged by I.T. Deptt.

FOR PROFESSIONAL/SELF-EMPLOYED/BUSSINESSMEN

34
  Three years I.T. Returns duly acknowledged by I.T.Deptt/I.T. Assessment Orders
for computation of income

 Copies of challans in respect of advance payment of income tax.

Property Documents Complete Chain Of Property

Investment Proofs as below Allotment Letter

LIC Latest Receipts Possession Letter

PPF A/C Statement Registry From G.D.A. or Builder Ist

registry

Other Property Registry Copy Own Registry

FD or any Investment with Post office etc. Estimate from Approved Architect (in
case of construction)

GDF Statement Balance Seller ID & Address Proof

Money Deposit Receipt & sale agreement

on Rs 100/-Stamp Paper

OTHER DOCUMENTS

Two cheques for lawyer’s and valuation report fee favouring “LOAN FRAME
COMPANY.

IN CASE TAKE OVER FROM OTHER BANK

 Loan Sanction Letter

 Loan A/C statement

 List of Document(pledge with Bank)

 Foreclosure letter (amount remaining)

 Form 13 & 13(a) & 13(b)& 13(c)

35
*KYC (Know Your Customer)-

 Photo Of Applicant & Co-applicant (passport size)

 Photo

 Id Proof

 PAN Card

 Govt. ID

 Passport

Age Proof

 PAN Card

 10th Certificate

 Passport

 Driving License

 Govt. ID

Signature proof

 PAN Card

 DL

 Bank Verification

 Voter ID Card

 Passport

Address Proof

 Utility Bill

36
  Voter-ID Card

 DL

 LIC Policy (in exceptional cases)

 Rental Agreement Land Owner's Utility Bill (in case of Rent)

*ITR —

 Computation of Balance Sheet and Profit and Loss A/c.

 Audit Report Schedule with CA's Stamp.

37
CALCULATION OF LOAN ELIGIBILITY

MAIN INCOME

Loan Eligibility arrived at Aggregation of Incomes ,Adjustment to income ,IIR & FOIR
Norms

Loan Amount by applying LTV Norms

Loan Amount ceiling for the product

Loan amount applied by the Applicant

a. Salaried

Loan Eligibility =

Gross Monthly salary - Existing obligations

EMI Factor

b. Self Employed Professional

Loan Eligibility=

Avg. (Gross Profit + Dep.) /12 - Existing Obligations

EMI Factor
38
c. Self Employed Non Professional

Loan Eligibility =

Avg. (Net Profit + Dep.) /12 - Existing Obligations

EMI Factor

OTHER OBSERVATIONS

1. General Process of Business Loan -

Login of File

Lo gin-id is provided

Address Verification (Residence, Office)

Telephone Verification
39
CIBIL Verification

If +VE If -VE

File Accepted File Rejected

Approval Letter is given to the Head

Sanction Letter is given to the Customer

(With Conditions)

Legal and Technical Verification initiated

Docket is being prepared (With full signature)

Login of Docket

40
If perfectly filled If not perfectly filled

Forwarded for disbursement goes back with Queries

Check Cut Queries is being resolved

Final Transaction

Queries are generally related to the files, whatever the documentation is

required according to the policy of the Bank if not completed at any stage
then that comes in the form of Query.

Docket is the Loan Agreement which contains the set of papers for the same.

41
Papers of Docket

 Set of Legal Papers

 Set of Technical papers
 Set of Loan Agreement
 Set of Customer's papers
 Sanction Letter with conditions

42
 Competitors:-

Loan frame Pvt. Ltd. faces a cut throat competition in the business loan sector.
Some competitors are as follows:-

DHFL

DHFL Bank is India's second largest private sector housing finance company. The Company was
founded in 1984 by late Shri Rajesh Kumar Wadhawan, with a vision to enable home ownership
amongst the low and middle income customer segment in semi-urban & rural India. Today, DHFL
has presence across 550 locations in India, and 2 international representative offices in UK &
UAE. These offices deal in a variety of home loan products. DHFL offers a vast array of Home
Loan products, including Home Loan, Plot Loan, Construction Loan, Loan against Property,
Mortgage Loans and Project Loans. The Company also offers a range of Fixed Deposit products
that ensure high yield, safety and liquidity. DHFL is amongst the first companies in India to
introduce insurance as a value-added product with housing finance. DHFL credit rating has been
recently upgraded to CARE AAA (Triple A) for its long term facilities, including Long Term Bank
Facilities, Non-Convertible Debentures (NCDs) and Fixed Deposits (FDs). [4] This is an important
milestone in the 30 years of business and is a testimony to the strong processes and systems that
DHFL has built over time. The Company has also been assigned BWR AAA from Brickworks
Rating

Bajaj Finserv,

a part of Bajaj Holdings & Investments Limited, is an Indian financial services company focused
on lending, asset management, wealth management and insurance. The company through its joint
ventures and subsidiaries employs over 20,000 employees and has established a nationwide

43
presence across over 1400 locations. The company is currently engaged in consumer finance
businesses, life insurance, and general insurance and has plans to expand its business by offering a
wide array of financial products and services in India. Apart from financial services, Bajaj Finserv
is also active in energy generation. Bajaj Finserv was ranked among The Economic Times 500 as
119 in 2014.

TATA CAPITAL

Tata Capital Limited is a subsidiary of Tata Sons Limited. The Company is registered with the
Reserve Bank of India as a Systemically Important Non Deposit Accepting Core Investment
Company and offers through itself and its subsidiaries fund and fee-based financial services to its
customers. Tata Capital Financial Services Limited ("TCFSL") is a subsidiary of Tata Capital
Limited. The Company is registered with the Reserve Bank of India as a Systemically Important
Non Deposit Accepting Non Banking Financial Company (NBFC) and offers fund and fee-based
financial services to its customers, under the Tata Capital brand. A trusted and customer-centric,
one-stop financial services provider, TCFSL caters to the diverse needs of retail, corporate and
institutional customers, across various areas of business namely the Commercial Finance,
Infrastructure Finance, Wealth Management, Consumer Loans and distribution and marketing of
Tata Cards. TCFSL has over 100 branches spanning all critical markets in India.

DCB

DCB Bank Ltd. (Formerly Development Credit Bank Ltd.) is a private sector scheduled commercial
bank in India. It has a network of 153 branches and 290 ATMs in the country. It offers products to
individuals, small and medium businesses, rural banking and mid corporates across its branch
network. The Bank is present in 17 states and 2 Union Territories. Metros having DCB Bank
branches are Ahmedabad, Bengaluru, Bhopal, Bhubaneswar, Chennai, Delhi NCR, Gurgaon,
Hyderabad, Indore, Jaipur, Kochi, Kolkata, Lucknow, Ludhiana, Mumbai, NOIDA, Pune and
Vadodara. DCB Bank has dedicated rural banking branches for agri& inclusive banking in Andhra

44
Pradesh, Chhattisgarh, Gujarat, Haryana, Madhya Pradesh, Maharashtra, Odisha, Rajasthan and
Telengana. States where DCB Bank branches are located: Andhra Pradesh, Chhattisgarh, Delhi
NCR, Gujarat, Goa, Haryana, Karnataka, Kerala, Madhya Pradesh, Maharashtra, Odisha, Punjab,
Rajasthan, Tamil Nadu, Telengana, Uttar Pradesh & West Bengal. DCB Bank recently inaugurated
branches at Karnal in Haryana and Madlapur in Maharashtra. The Aga Khan Fund for Economic
Development (AKFED) in the promoter of the Bank with around 16.4% stake. Public shareholding
under the Resident Individual category is approximately 39.4%. The Bank received the Scheduled
Commercial Bank licence from the Reserve Bank of India on 31 May 1995.

45
 RESEARCH OBJECTIVE

 To study the customers perceptions about business loans

 To analyze the history and scope of Business Loans
 To know the ideas of customers about business loan products and services
 To study the satisfaction level of customers about business loans.

46
 SCOPE OF STUDY
The Indian business finance industry has grown by leaps and bound in few years.
Total business loans disbursements by banks has risen which witnesses
phenomenal growth from last 5 years. There are greater number of borrower of
business loans. so by this study we can find out satisfaction level of customers
and problems faced by them in obtaining business.

47
 RESEARCH METHDOLOGY

Research Process:

1. Need justification:
To know the various customer and different type of methods used by the banks,
Loan frame company research was needed.

2. Data Need: Primary and Secondary data, both the data are needed to
generate the lead.

3. Data Source : Primary data source

References
Social Networking
Secondary data sources
Banks

4. Research Design : As I have worked with Loan frame , in which I have

gone through insight investigation and accordingly,

I took decisions in terms of eligibility of the customer that is why I can say that, I
have worked upon the conclusive-descriptive research methodology.

5. Research Instrument:

Lead generation through Questionnaire

Lead generation through Tele-calling/ interviews

48
 DATA ANALYIS

Type / ownership of business:

Sole Proprietorship 40

Partnership 35

LLP 0

Private Limited Company 25

Sole Proprietorship Partnership LLP Private Limited Company

25%
40%
0%

35%

Interpretation

The above graph shows that 40% of the respondents run a business as a sole
proprietorship, 35% of the respondents doing business in partnership firm and 25% are
the private Limited firms.

49
Type of work

Manufacturing / distributorship 40

Wholesale / Trader 30

Retail 20

Service 10

Manufacturing / distributorship Wholesale / Trader Retail Service

10%

20% 40%

30%

Interpretation

The above graph shows that the 40% of the residents are doing manufacturing, 30% of the
respondents are wholesalers and traders, 20% of the respondents are retailers and remaining 10%
of the respondents are service providers.

50
What is your business turnover?

< 10 lakhs 5

10-25 lakhs 35

25--50 lakhs 30

50 lakhs - 1 crore 25

1 crore + 5

< 10 lakhs 10-25 lakhs 25--50 lakhs 50 lakhs - 1 crore 1 crore +

5% 5%
25%
35%

30%

Interpretation

The above graph shows that the 5% of the respondents having turnover is <10 lakhs, 35% of
respondents having turnover between 10-25 lakhs, 30% of respondents having turnover between
25-50 lakhs, 25% of respondents having turnover between 50 lakhs -1 crore and only 5% of the
respondents are having turnover is above 1 crore.

51
When looking for a loan, where do you go first to seek information

Your bank 40

NBFCs 25

CAs 3

Loan Agents 5

Online 15

Friends / Relatives 5

Any Other 2

Your bank NBFCs

CAs Loan Agents
Online Friends / Relatives
Business Associates / Partners / Colleagues Competitor Businesses
Any Other

2% 3% 2%
5%

15% 40%

5%

25%
3%

Interpretation

The above graph shows that the 40% of the respondents are approached to their bank for a loan,
25% of the respondents are approached to NBFCs for a loan, 5% of the respondents are
approached to their CAs, 5% of the respondents are approached to loan agents for a loan, 15% of
the respondents are look on internet for a loan, 5% of the respondents are contacted with friends /
relatives for a loan, and remaining 2% of the respondents are arranged some other sources.

52
What is the most important factor to choose a Lender? Rate the following (on a scale of 1-5,
where 1 is least important and 5 being most important).

Past Business Relationship / Existing Bank

1 2 3 4 5

Interest Rate

1 2 3 4 5

Good reputation of lender in market

1 2 3 4 5

Speed of loan disbursal (how quickly the lender provides a loan)

1 2 3 4 5

Sales

existing bank

interest

good repotation of lender

market
speed of loan disbursal

Interpretation

Above the graph the 1st preference is goes to interest rate. 2nd is to speed of disbursal is also
motivate to borrowing a loan. 3rd preference is existing bank the customer is also take a loan

53
from his/her existing bank and last is goes to good reputation of lender in market is also impact
to bprrow a loan but this is last option.

Which of these social networking sites do you use regularly.

None 20
Facebook 45
Youtube 5
Twitter 10
Instagram 10
Linkedin 5
Others 5

None Facebook Youtube twitter instagram linkedin others

5%
5% 20%
10%
10%
5%

45%

Interpretation

The above graph shows that the 20% of the respondents didn't use any social networking site,
45% of the respondents are using facebook, 5% of the respondents are using youtube, 10% of
the respondents are using Twitter, 10% of the respondents are using Instagram, 10% of the
respondents are using linkedin and remaining 5% of the residents are using other social
networking sites.

54
How often do you use e-mail

Daily 30

Weekly 40

Once in a month 20

Never 10

Daily Weekly Once in a month Never

10%
30%
20%

40%

Interpretation
The above graph shows that the 30% of respondents are checked email daily, 40% of
respondents are checked email weekly, 20% of respondents are checked email once in a month
and remaining 10% of the respondents are never using email.

55
What is your language preference for business news / info.

Hindi 60

English 40

Others 00

Hindi English Others

0%

40%

60%

Interpretation
The above graph shows that the 60% of the respondents are preferred Hindi language for
business news and information and 40% of the respondents are preferred English language for
business news and information.

56
Do you attend any trade events

Yes 40

No 60

Yes No

40%

60%

Interpretation
The above graph shows that the 40% of the respondents are attended some trade events but the
large number of respondents i.e. 60% of the respondents didn’t attended any trade event.

57
Which medium do you use to get information and news about your industry:

Newspaper 30

Magazine 15

Internet 40

Business Forum / Trade Associations 10

Any Other Please Specify 5

Newspaper Magazine
Internet Business Forum / Trade Associations
Any Other Please Specify

10% 5%
30%

40% 15%

Interpretation
The above graph shows that the 30% of the respondents are read newspaper to get information
and news about their industry, 15% of the respondents are read newspaper to get information and
news about their industry, 40% of the respondents are using internet to get information and news
about their industry, 10% of the respondents are said they get information and news about their
industry from Business Forum / Trade Associations and remaining 5% said that they get
information about their business from other sources.

58
Age group of person

Interpretation

During the survey I found that maximum 45% of people comes under 36 to 45
years of age and the least age group is 20 to 25 with an percentage of 10% and the
remaining 30% comes under 46 to 60 age group and 15% as depicted comes under
26 to 35 age group.

59
Gender of the person

Interpretation

In the survey I generally met with male customers who were in majority with 85%
and female customers with the very less percentage as compared with 15% only.

60
Profession of the person I met

Interpretation

During the survey Maximum 48% of customers were having the own business and
were self employed, 33% of the customers belongs to the salaried group, 10 % of
customers are professionals, 2% are retired and 7 % belongs to the other category.

61
Income of the perso

Interpretation

Generally I met with the people who lies between the income group of 6 lakhs and
above covering 40% of the whole as depicted in the pie chart then 32% lies
between 4 to 6 lakhs the least 10% is below 2 lakhs and the remaining 28% comes
between the age group of 2 to 4 lakh

62
 FINDING
 The above graph shows that 40% of the respondents run a business as a sole
proprietorship, 35% of the respondents doing business in partnership firm and 25% are
the private Limited firms.

 The above graph shows that the 20% of the respondents didn't use any social networking
site, 45% of the respondents are using facebook, 5% of the respondents are using
youtube, 10% of the respondents are using Twitter, 10% of the respondents are using
Instagram, 10% of the respondents are using linkedin and remaining 5% of the residents
are using other social networking sites.

 The above graph shows that the 40% of the respondents are attended some trade events
but the large number of respondents i.e. 60% of the respondents didn’t attended any trade
event.

 Above the graph the 1st preference is goes to interest rate. 2nd is to speed of disbursal is
also motivate to borrowing a loan. 3rd preference is existing bank the customer is also
take a loan from his/her existing bank and last is goes to good reputation of lender in
market is also impact to bprrow a loan but this is last option.

63
 RECOMMENDATIONS

• Customer awareness Programme is required so that more people should attract towards
Loan product.

• If there are any kind of hidden charges than that must disclose to customer before giving
loan to them.

• Loan Frame must take some steps so that customers can get their loan in time. Like
phone verification by customer care that one customer is got their loan on time or not .It must be
before a certain date so necessary steps can be taken.

• Loan product selling agents must not give any type of wrong information regarding Loan
product.

• Loan Frame customer care should more concern about the fastest settlement of customer
problems.

• Before deducting or charging any monetary charge Loan Frame must consult with
customer.

• Special scheme should be implemented to encourage both customer and agents.

• Loan Frame must take feedbacks of customers regarding features & services.

64
 LIMITATIONS OF THE STUDY:-

This study also includes some limitations which have been discussed as follows:

i)To access such a large number of customers was difficult because of non-cooperative attitude
of respondents.

ii)Lack of data was also the other limitation of the study as some of do not have proper data on
topic.

iii)There was limitation of time to conduct such a big survey in limited available time.

iv)Ignorance and reluctant attitude of customers was also a major limitation in this study. Thus
above all were the limitations in this research study. The maximum efforts were made
to overcome these limitations in the study.

65
 CONCLUSION

From the analysis part it can be conclude that customers have a good respond towards Loan
Frame products are in 1st position having large number of customers & providing good services
to them. The bank has a wide customer base, so the bank should concentrate on this to retain
these customers.

In present scenario Loan Frame is the largest Loan product issuer in India. Within a very short
period of time the achievement made by Loan Frame is excellent, what a NBFC cannot expect,
but it is being done by Loan Frame. It happens due to employee dedication towards the
organization, fastest growing Indian economy, & brand image.

To be the largest Loan product issuer, Loan Frame should focus on-

• Launch Innovative product

• Customized Loan products

• Better customer services

• Fastest customers problem solving techniques

• Customer retention

Apart from all the above, Loan Frame believe in providing good customer services to their
customers which is a key factor for success in future.

66
 LOAN FRAME
Requirement for business loan.

We are conducting this survey to understand the loan related needs of small
business . data provided will only be used for research study and will not be shared
with any other company.

1) Business segment type .

A. Advertising
B. Auto Accessiories
`C. Hotels
D. FMCG
E. if any other ------------------------------------

2) Number of years of business…………………………

3) Type / Ownership of Business

A. Proprietorship
B. Partnership
C. LLP
D. Private ltd .company

4) Type of Work .
A. Manufacturing
B. Wholesale/trader
C. Retail
D. Service

67
5) Do you have any loan requirement .

A .Yes B. No

6) IF, yes what is the amount of loan required .

A. 0-2 L
B. 2-5 L
C. 10 L
D. 10-20 L
E. 20 L +

7) What type of digital payment method do you use to do business .

A. Paytm
B. Mobikwik
C. Others
D. Pos

8) What is your business turnover ?

A. <10 L
B. 10-20 L
C. 25-50 L
D. 50L-1Cr
E. 1CR

9) Have you taken any personal or business loan in the past 5 years.

A. Yes
B. No
68
 10) What was the business loan amount .

A. 0-2 la
B. 2-5 la
C. 10 lak
D. 10-20 lak
E. 20 lak

11) What was the rate of interest .

12 What was the business loan tenure

13)What was the name of business lender .(Bank ,nbfc ,or other )

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69