Often businesses, especially the small and first generation start ups are not in a position to avail overdraft facility from banks simply because they cannot offer any collateral to the banks. It is a common enough experience that when you approach your banker for a working capital facility his one of the first questions to you is what collateral can you offer. Even for increasing the existing credit lines the banks more often than not ask for additional collaterals. This becomes a huge hindrance for arranging working capital or enhancements of existing limits.
We can arrange for overdraft facilities from banks without asking for security on the basis of your business value. This is a very useful for first generation businesses. The limits will be based on last year's performance. Backed by a guarantee from the central government.
All that is asked of is that the business be operating for more than 3 years with a turnover of more than Rs.100 lacs and having profits and SSI registration.