Lease Finance facility for purchase of “Zarkaashat Drip Irrigation System” from m/s dadex eternit ltd. Under kissan dost aabiari finance scheme

In order to overcome the shortage of water in the country as well as ensure adequate water supply for meeting the ever increasing demand of water for civic and agriculture use, our Bank has entered into an agreement with M/S DADEX ETERNIT LIMITED to make arrangements for facilitating supply of “ZarKaasht Drip Irrigation System” to farming community.

For the purpose, a new product “Lease Finance Facility for Purchase of ZarKaasht Drip Irrigation System from M/s Dadex Eternit Ltd.” is being introduced under our regular Kissan Dost Aabiari Finance Scheme on the following terms & conditions:-

 Purpose

The purpose of the scheme is to provide Finance Facility for purchase & installation of ‘ZarKaasht Drip Irrigation System’ from M/s Dadex under our regular Kissan Dost Aabiari Finance Scheme.

Eligibility

• Applicant should be a Resident/Self cultivator
• Applicant should not be a defaulter of any Financial Institution
• Applicant should have land free from all encumbrances to be offered as security

 Nature & Tenure Of Facilitiy

o   Medium Term Lease Finance Facility (L/F) for a maximum period of Five (05) Years.

Amount Of Finance (For Purchase & Installation of ‘ZarKaasht’ Drip Irrigation System from M/s

Dadex)

Maximum 80% of the purchase price of the system (as per quotation submitted by M/s Dadex)

Equity

Minimum 20% of the purchase price of the system (to be contributed by the applicant)

Type Of Security

     Primary

     Leased Assets (Drip Irrigation System) (original receipts will be issued in the name of the 

     Bank of Punjab).

       Collateral

·         Charge on Agriculture Land through Agri. Pass Book.

                                        OR

·         Registered/Equitable Mortgage on urban immovable property. The property should be

       cleared by the banks approved legal counsel and will be assessed by the Banks and PBAs

       approved surveyor.                                                             

                                        OR

·         Liquid security in shape of Bank’s Fixed Deposit Receipt/DSC/NSC or Regular Income

       Certificates.

·         One personal guarantee of a reputable person. ACO along with Regional Chief can waive

       this condition if they deem the borrower to be credit worthy.

·         Two written satisfactory market checking reports

Margin On Security

     In Case Of Oast Bai Value Of Agri Land

·         The maximum amount of Finance will be allowed up to 75% of the Oast Bai Value (duly

        verified by Revenue Officer) of Agri Land

     In Case Of Market Value Of Agri Land

·         The maximum amount of Finance will be allowed up to 60% of the Forced Sale Value of the   property as evaluated by PBA/Bank’s approved surveyor.

    In Case Of Market Value Of Urban/Commercial Land

·         The maximum amount of Finance will be allowed up to 75% of the Forced Sale Value of the

       property as evaluated by PBA/Bank’s approved surveyor.

Insurance

·         Comprehensive Insurance (assigned to BOP) of the Leased Assets at borrower’s cost. 

·         Life assurance of the borrower (assigned to BOP)

·          

Mark Up Rate

·         15% per annum.

(To be recovered in advance from the payments to be made to M/s Dadex for first year and for remaining period will be recovered from borrower along with principal through installments)

Payment Plan Sharing Of Mark Up

·         75% of the total amount of finance facility shall be paid to M/s Dadex in advance

·         Remaining 25% shall be paid after the issuance of completion certificate

Recovery Of Mark Up For First Year

·      In all Cases, BOP will recover 75% of the mark up (for first year) from the firstdisbursement       

                                                            &

·         Remaining 25% of mark up will be recovered from the second installment of disbursement.

 Repayment

·         10 Half Yearly installments (Principal only for first year and Principal + Mark up for remaining

        four years)

Procedure For Provision And Installation Of Zarkaasht Products

o     ZarKaasht will negotiate purchase price & installation cost of drip irrigation system and other details with intended borrower. The price, installation and other items to be used in drip irrigation system will be decided between party and the company and there will be no binding on the Bank in connection with the issues.

o     ZarKaasht will also provide a list of its authorized persons dealers/sale centers who will deal with the Bank and customers at local areas.

o     ZarKaasht will provide a quotation of the drip irrigation system to be installed along with details to the borrower, duly signed by authorized persons dealers/sale agents of the Company along with recommendations for allowing financial facility to person under Bank’s Policy.

o     The farmer(s) duly recommended by ZarKaasht will approach Bank’s Branch and will apply for Lease Finance Facility under Kissan Dost Aabiari Scheme.

o     Upon fulfillment of BOP’s pre requisites/criteria, BOP will approve financial facility in favour of the person intending to purchase and install drip irrigation system.

o     After approval of facility in favour of borrower, Bank will complete all     documentary formalities regarding creation of Bank’s charge on security.

o     Bank will issue certificate in favour of the Company (ZarKaasht) that all formalities have been completed and the drip irrigation system may be installed at farmer’s land in accordance with the quotation and other terms and conditions agreed with him.