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Financing Of Equipment Manufacturing (Em) For Power Sector

Object & Scope

• The financial assistance shall be to utilized to meet the cost of equipment & material and related expenses under the contract for power infrastructure project. Only short term & medium term facility is available under the scheme.

Eligible Entities

• Power equipment / material manufacture both in the public & private sector who have been awarded firm orders for supply of equipment / material for power project in India by central / state sector power utilities and government companies. A public sector manufacturing company supplying equipment to private sector company will also be eligible under the scheme.

Lending Rates and Financial Charges

• Lending rates shall be notified by REC from time to time, as per the rating of theborrowing entity/ promoter.Financial charges shall be payable by the borrowers, as applicable from time to time in terms of REC policy in this regard.

Extent of Funding (% of project cost)

• State / Central Sector/ AAA rate entities: -70 % of total contact value of supply excluding advance payment subject to maximum of Rs. 100 Cr.
• Others: - -  50 % of total contact value of supply excluding advance payment subject to maximum of Rs. 100 Cr.

Maximum Repayment Period

• The period of short term loan is one year and of medium term loan is three years. The repayment of loan will be equal quarterly installments. The interest shall be paid on monthly basis.

Securities

• State/Central Govt. guarantee/Bank Guarantee/Charge on Assets;
• Escrow Account/Letter of Credit;

REC may insist on one or more of the following additional securities based on appraisal /category of borrower