Credit Policy & MSME Department, Central Office

Union Bank Bhavan, 239, VidhanBhavan Marg, Nariman Point, Mumbai 400021
INSTRUCTION CIRCULAR: 2076-2020 26 May 2020

TO ALL BRANCHES/OFFICES

Management of Credit Portfolio –

Union Guaranteed Emergency Credit Line (UGECL)

1. Attention of all Branches / Offices is invited to IC no.2023-2020 dated 09.04.2020 vide

which a comprehensive scheme: COVID Emergency Line of Credit (CELC) was introduced to
meet the temporary liquidity mismatch arising out of COVID-19 crisis.

2. With rising COVID-19 cases, urgent attention needs to be paid to the economy which is on a
standstill in these times of the lockdown. To provide relief to millions of small businesses
reeling under the impact of the Covid-19 lockdown, Government has announced various
liquidity measures for MSMEs vide its Atmanirbhar Bharat (Self-Reliant India) Relief Package.

3. One of such measures includes providing collateral free loans to Business enterprises / MSME
units. In this regard, a new product Emergency Credit Line Guarantee Scheme (ECLGS)
[credit product: Guaranteed Emergency Credit Line (GECL)] has been launched by
Government of India through Ministry of Finance, Department of Financial Services. National
Credit Guarantee Trustee Company Limited (NCGTC) is responsible for management of this
scheme.

4. Accordingly, a detailed scheme: Union Guaranteed Emergency Credit Line (UGECL) has
been finalized by our Bank to provide finance to eligible units without any delay. The
UGECL scheme contains:

 Detailed Scheme Guidelines as appended in Annexure I.

 Format for Sanction of UGECL Loan, is appended in Annexure A to Annexure I.
 The Undertaking letter format is provided in Annexure B to Annexure I.

5. The subject scheme shall be effective from the date of issue of this circular across the
amalgamated entity.

6. Respective ROs should ensure that scheme is percolated to each and every branch.
Focused approach should be made on the selective Tier II/Tier III/Semi urban/Rural
branches so that benefits are passed on to the every strata of eligible borrower.

7. Field Functionaries are requested to effectively market the scheme and ensure timely
help to the eligible borrowers.
 Union Guaranteed Emergency Credit Line (UGECL)

Annexure- I
Sl. No. Parameter Details
1. Name of the a. The name of this credit product is “Union Guaranteed
Facility Emergency Credit Line” (UGECL).

b. In GECL, 100% credit guarantee coverage by National Credit

Guarantee Trustee Company (NCGTC) is available to Member
lending Institutions (MLI) like our Bank.

c. The Government‟s guarantee scheme is named as „Emergency

Credit Line Guarantee Scheme‟ (ECLGS)

d. Purpose for ECLGS: To provide 100% guarantee coverage for the

UGECL, which shall be a pre-approved sanction limit of upto 20%
of loan outstanding as on 29th February, 2020 to eligible
borrowers, in the form of additional working capital term loan
facility (in case of banks and Financial Institutions), eligible
Business Enterprises / Micro, Small and Medium Enterprise (MSME)
borrowers, including interested Pradhan Mantri Mudra Yojna
(PMMY) borrowers , in view of COVID-19 crisis, as a special
Scheme.

2. Eligible a. All Business Enterprises /MSME borrower accounts with combined

Borrowers outstanding loans across all MLIs (Banks/NBFCs/FIs) of up to Rs.
25 crore as on 29.2.2020
and
Annual turnover of up to Rs.100 crore for FY 2019-20 are eligible
for the Scheme.

In case Financials of FY 2019-20 are not audited, customer to

submit a declaration confirming that the turnover is upto Rs.100
crores during FY 2019-20.

b.Branches to check with credit bureau (like CIBIL etc)/CRILC (in

applicable cases) for the overall outstanding of the borrower to
assess the eligibility of the borrower.

c. Loans provided to Business Enterprises / MSMEs constituted as

Proprietorship, Partnership, registered company, trusts and
Limited Liability Partnerships (LLPs) shall be eligible for loan
under the Scheme.

For instance: Any existing loan such as Commercial Vehicle (CV)

loan taken by an entity shall be covered but CV loan taken by
promoter or director in personal capacity shall not be covered.

d. Loans provided in individual capacity are not covered under the

Scheme (Other than loans to individuals under PMMY registered
on or before 29.02.2020 with Mudra Portal).

e. For the purpose of this Scheme, Business Enterprises / MSMEs

would include loans covered under Pradhan Mantri Mudra Yojana
(PMMY) extended on or before 29.2.2020, and reported on the
MUDRA portal. All eligibility conditions including the condition
related to Days past due would also apply to PMMY loans.
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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

f. For loans having co-applicant, only those existing loans where
entity is the primary co-applicant are covered under the Scheme
for additional emergency funding.

g. The Scheme is valid for existing customers on the books of the

Bank. Borrower accounts should be less than or equal to 60 days
past due as on 29th February, 2020 in order to be eligible under
the Scheme. i.e. All borrowers which have not been classified as
SMA 2 or NPA by any of the MLIs as on 29th February, 2020 will be
eligible for the Scheme.

h. Days Past Due status as on 29.2.2020 to be checked across Banks/

FIs from credit bureaus/CRILC.

i. Business Enterprises / MSME borrower accounts which had NPA or

SMA-2 status as on 29.2.2020 with any MLIs shall not be eligible
under the Scheme.

j. Business Enterprises / MSME borrower must be GST registered in

all cases where such registration is mandatory. This condition will
not apply to Business Enterprises / MSMEs that are not required
to obtain GST registration.

k. For the purpose of this Scheme, it is not necessary that the

existing loans of the borrowers should be covered under the
existing NCGTC (National Credit Guarantee Trust Company) or
CGTMSE (Credit Guarantee Fund Trust for Micro & Small
Enterprises) Scheme.

Examples on the eligibility of the borrowers are indicated below:

Name of Overall Overall DPD of Turnover as Remark

the Outstanding of Outstanding of borrower per latest
Borrower the Borrower the Borrower as on 29th available
across MLIs with MLI (INR Feb 2020 financials
(INR Crores) Crores) (Days) (INR Crores)

Borrower A 30 15 30 90 Not eligible

Borrower B 30 15 62 90 Not eligible
Borrower C 25 25 59 75 Eligible
Borrower D 15 10 0 80 Eligible
Borrower E 20 10 0 125 Not Eligible

Sl. No. Parameter Details

3. Purpose The main objective of the Scheme is to increase access to, and
enable availability of additional funding facility to Business
Enterprises/ MSME borrowers, in view of the economic distress
caused by the COVID-19 crisis, by providing 100 percent guarantee
coverage.

UGECL shall be a “pre-approved” sanction limit of up to 20% of loan

outstanding as on 29th February, 2020 to eligible borrowers, in the
form of additional working capital term loan facility to eligible

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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

Business Enterprises / Micro, Small and Medium Enterprise (MSME)
borrowers, including interested PMMY borrowers, in view of COVID19
crisis, as a special Scheme.

4. Quantum of a. The amount of UGECL funding to eligible Business Enterprises/

Finance MSME borrowers would be in the form of additional working
capital term loan facility up to 20% of total outstanding loans up
to Rs. 25 crores as on 29th February, 2020, subject to the
borrower meeting all the eligibility criteria‟s.

b. Total Outstanding Amount would comprise of the on-balance

sheet exposure such as outstanding amount across WC loans, term
loans and WCTL loans. Off-balance sheet and non-fund based
exposures will be excluded.

Branches to check with credit bureau/CRILC the overall

outstanding of the borrower to assess the overall additional loan
amount eligible for sanction under the Scheme.

c. Branches are required to open a separate account for Credit

Facility extended through the Scheme under the scheme code
UGECL.

d. Loans extended through current Government schemes such as

PMEGP, PMMY etc. would continue to be categorized under that
scheme as earlier. WCTL under this Scheme shall be over and
above the existing loan.

e. In case a borrower has existing limits with multiple lenders,

UGECL may be availed either through one lender or multiple
lenders depending upon the agreement between the borrower
and the Branch/ Bank.

f. In case the borrower (falling under multiple/consortium) wishes

to take from Bank an amount more than the proportional 20% of
the outstanding credit that the borrower has with that Bank, a No
Objection Certificate (NOC) would be required from all other
lenders. In this case for account falling up to RLCC delegation,
RLCC will be the competent sanction authority. For account
falling under ZLCC and above, same delegated sanctioning
authority can sanction the loan.

g. No NOC will, however, be required if the UGECL availed from a

particular lender is limited to the proportional 20% of the
outstanding credit that the borrower has with that lender.

h. Total o/s amount of the regular credit limits as on 29.02.2020

shall be considered for arriving at eligible amount i.e. Excess
Over Limit (EOL) etc shall not form part of the o/s amount while
calculating of eligible amount (20% of total outstanding) for
UGECL facility.

i. However in case any account having outstanding balance of above

Rs.25 crores due to interest application or otherwise on

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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

29.02.2020, with all MLIs together even though the sanction limit
among all MLIs is Rs.25 crores or less, such accounts will not be
eligible for UGECL facility.

j. EOL of limit due to interest application /payment of devolved

LC/payment due to crystallization of non-fund based limit to fund
based limit is to be excluded for the purpose of the calculation of
20% limit.

k. Basis of calculation is 20% of the outstanding including adhoc

facility if any, as on 29.02.2020. Provided such adhoc is not
overdue for payment as on 29.02.2020.

Examples to calculate the loan amount (Maximum) covered under

the Guarantee coverage

Overall Total Loan Total Loan

Overall Outstanding
Outstanding of Amount allowed Amount allowed
Name of the of the Borrower
the Borrower under the without NOC for
Borrower with MLI
across MLIs scheme MLI
(INR Crores)
(INR Crores) (INR Crores) (INR Crores)
A B C= 20% of A D= 20% of B
Borrower A 20 15 4 3
Borrower B 5 2 1 0.4
Borrower C 25 2.5 5 0.5
Borrower D 15 10 3 2

Sl. No. Parameter Details

5. Facility Type Working Capital Term Loan facility (Term Loan to be opened)

A separate loan account should be opened for the borrower, distinct

from the existing loan account(s), for coverage under the Scheme.
6. Margin Nil

7. Validity of The Scheme would be applicable to all loans sanctioned under UGECL
Scheme during the period from the date of issue of these guidelines up to
31.10.2020 (or as per information for withdrawal of the scheme
received from NCGTC on the matter which will be communicated to
the branches), sanction cum disbursement (means even one
disbursement) in the scheme is to be made latest by 31.10.2020.

8. Security / The additional WCTL facility granted under UGECL shall rank pari
Guarantee passu with the existing credit facilities, in term of cash flows and
securities, with charge on the assets financed under the Scheme to
be created within a period of three months (90 days) from the date
of disbursal.

No additional collateral shall be asked for additional funding under

UGECL.

Guarantee: Extension of existing Personal/ Corporate guarantee of

promoters/ concern/ group concerns/ guarantors, as applicable.

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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

9. Repayment  The tenor of loans provided under UGECL shall have a maximum
tenor of four years from the date of disbursement (including
moratorium).

 Moratorium period of up to one year (maximum) on the principal

amount shall be provided to borrowers for the UGECL funding
during which interest shall be payable as and when debited.

 The principal shall be repaid in maximum 36 Equated Monthly

Installments (EMI) after the moratorium period is over.

10. Interest Rate Interest Rate on UGECL shall be capped as under:

7.50% p.a. FIXED (for the entire tenure of the loan)

The account may be operated in combination with applicable

Interest Subvention Scheme(s) as far as feasible.

11. Penal Interest Penal interest @1.00% shall be charged on the overdue of interest
and installment of UGECL facility. Account is also subject to penal
interest of 1.00% for non compliance of sanction terms and
conditions. However, maximum penal interest not to exceed 1.00%.

No penal interest to be charged on additional loan during the

sanction time, due to any non-compliance of the already accepted
covenants on the existing credit facilities.

12. Appraisal a. The limit will be over and above the assessed Banking
finance.(Annexure A to be used)

b. The SMS informing preapproval of UGECL having an „opt-out‟

option will be provided to the eligible Business Enterprises /
MSME borrowers to enable them to choose whether they wish to
avail facility or not. An “opt out” option (or akin to opt out) will
also will be provided in the letters/email communication etc
wherein discretion is given to borrower to take or not to take
loan.

c. Kindly note that preapproved message will be sent to the

borrower based on certain logic being applied on the information
of the borrower that Bank is having in its data base. But just
mere receipt or even non receipt of the message/letter/
communication from bank may not be taken as approval or non
approval of loan. A borrower otherwise being eligible can always
independently approach bank for coverage under the scheme.

d. IRAC norms as stipulated shall be applicable.

e. Branches shall generate CRILC report (as applicable), CICs reports

for ascertaining the SMA-2/NPA status of the borrower across all
MLIs as on 29.02.2020. Branches may note that as per RBI
directives, assets classification as of 29.02.2020 will remain
standstill till 31.08.2020.

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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

13. Disbursal a. The Term Loan sanctioned under UGECL facility is to be disbursed
to the credit of regular CC limit/ Current A/c or to be used for
any other specific business related purpose. End use of fund to be
monitored by branch at all time.

b. In case of account having non-compliance of sanction terms/

major audit irregularities only maximum 50% of sanctioned UGECL
limit is to be disbursed. Only on compliance of all sanction terms
rest of amount to be disbursed.

c. However in case of any non compliance due to imperfection of

collateral securities /mortgage (whether prime or collateral) no
disbursement is to be made. Only after perfection of the same
disbursement is to be made.

d. The end use of the facility is to be ensured as it is meant for

meeting the financial requirement of the borrower in connection
with the running of the unit as per sanction terms.

14. Delegation The additional sanction of 20% will fall under the delegation power
of same sanctioning authority under whose delegation the existing
facility was sanctioned.

Sanction of additional facility under UGECL (maximum @20%) the

total exposure may exceed the delegation power as stipulated in
policy on delegation of loaning powers at various levels. For
sanctioning of UGECL facility, such usage of delegation shall not be
construed as breach.

For e.g.
Existing Existing Proposed Proposed Proposed
Delegation Sanctioning Additional Total sanctioning
power Authority under Exposure Authority
(Amt) UGELC
Rs 0.75 Cr BH: Scale III 0.15 Cr 0.90 Cr BH:Scale III
Rs 15.00 Cr SLCC:I 3.00 Cr 18.00 Cr SLCC:I
Rs 25.00 Cr RLCC:I Rs 5.00 Cr 30.00 Cr RLCC:I
(DGM) (DGM)

With regard to process flow of proposals under UGECL, proposals of IFB, MCB shall be directly
submitted to LCV / MCV respectively.

Note:
Usually following cases are forwarded to next higher authority for sanctioning. However, for
sanction of UGELC same need not be sent to next higher authority in case of following:

 Account sanctioned/ enhanced/ad-hoc given in last 6 months.

 CIBIL-CMR rating as available/ generated afresh to be ignored for this facility.
 Existing internal rating /scoring in such account should not be more than 18 months
old.
 In case the borrower (falling under multiple/consortium) wishes to take from Bank an
amount more than the proportional 20% of the outstanding credit that the borrower
has with that our Bank, a No Objection Certificate (NOC) would be required from all
other lenders. In this case for account falling upto RLCC delegation, RLCC will be the
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 Union Guaranteed Emergency Credit Line (UGECL)

competent sanction authority. For account falling under ZLCC and above, same
delegated sanctioning authority can sanction the loan.

Sl. No. Parameter Details

15. Documentation/ a. Applicable documents (DP Note, SD-01, SD-19, SD-20, AD-02A, AD-
CPA 07, AD-09, AD-10, AD-11, interest agreement as applicable
depending upon constitution of the borrower) as per Bank‟s
guidelines are to be obtained before disbursement.

b. Perfection of securities is to be done within maximum 90 days

from the date of disbursal.

c. Self CPA as per prevailing cut off (CPA is to be conducted by an

officer of same branch other than the processing officer) is
required in the UGELC facility.

d. However, post perfection of securities CPA as per extant cut off

and prevailing norms is to be done within 120 days from the date
of disbursement by Regional Office.

e. Declaration as given in Annexure B to taken from the borrowers.

16. Commitment Not applicable

Charges
17. Processing Nil
charges/
Documentation
Charges/ EM
charges
18. Prepayment NIL
Penalty
19. Rating UGECL facility being a pre-approved additional finance for existing
borrowers, separate rating shall not be applicable.

20. Scheme code All Loans under the scheme to be opened under Scheme Code –
UGECL.
21. Guarantee a. Guarantee fee shall be NIL.
Details
b. Extent of Guarantee Coverage: The Trustee company shall
provide 100% Guarantee coverage on the outstanding amount for
the credit facility provided under the scheme as on the date of
NPA.

c. The definition of default for borrowers shall be as per the

instructions and guidelines issued by the Reserve Bank of India
from time to time under extant norms on income recognition,
asset classification and provisioning.

d. Invocation of Guarantee:
 Bank/ Branch are required to inform the date on which the
account was classified as NPA within 90 days of the account
being classified as NPA.
 The Trustee Company shall pay 75 per cent of the guaranteed
amount within 30 days of preferring of eligible claim by the
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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

lending institution, subject to the claim being otherwise found
in order and complete in all respects. The balance 25 per cent
of the guaranteed amount will be paid on conclusion of
recovery proceedings or till the decree gets time barred,
whichever is earlier.

e. Appropriation of amount realized by the lending institution after

the guarantee has been invoked:
 Post invocation of the guarantee claim, if any recoveries are
made, Bank shall first adjust such recoveries towards the legal
costs incurred for recovery of the amount and then shall
thereafter remit to NCGTC the balance recoveries.

22. Reporting/ a. All the sanctions under the scheme are to be reported to the
Monitoring respective authority in M-27 statements on monthly basis as per
extant guidelines and Monthly Monitoring reports as per
prescribed periodicity.

b. In case of non-adjustment of limit on due date, strict follow-up

should be made for recovery of overdue amount and the same
should also be immediately reported to Regional Office and in
the monitoring reports.

c. The flow of the proposal/disposal in the scheme is to be closely

monitored by special Covid cell being functional at RO level.

23. Special a. Branches/Offices shall valuate credit proposals by using prudent

Conditions banking judgment & use their business discretion /due diligence
in selecting commercially viable proposals and conduct the
account(s) of the borrowers with normal banking prudence.

b. Branch shall closely monitor the borrower account. The Branch

shall put in required efforts to ensure that the account is
serviced regularly.

c. Branch shall safeguard that the primary securities taken from the
borrower in respect of the credit facility are in good and
enforceable condition.

d. Branch shall ensure that the guarantee claim in respect of the

credit facility and borrower is lodged with the Trust in the form
and in the manner and within such time as may be specified by
the Trust in this behalf and that there shall not be any delay on
its part to notify the default in the borrowers account which shall
result in the Trust facing higher guarantee claims/ claim
rejections.
e. Branch shall exercise all the necessary precautions and maintain
its recourse to the borrower for entire amount of credit facility
owed by Bank and initiate such necessary actions for recovery of
the outstanding amount, including such action as may be advised
by the Trust.

f. It shall be the responsibility of the Branch to recover the entire

outstanding amount of the credit from the borrower, the
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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

guarantee claim should not take away the responsibility of
recovering the loan dues.

g. Branch shall exercise the same diligence in recovering the dues

and safeguarding the interest of the Trust, in all the ways open
to it as it might have exercised in the normal course if no
guarantee had been furnished by the Trustee Company. Branch/
Sanctioning authority shall, in particular, refrain from any act of
omission or commission, either before or subsequent to
invocation of guarantee, which may adversely affect the interest
of the Trustee Company as the guarantor. In particular, the
Branch/ Sanctioning authority should intimate the Trust while
entering into any compromise or arrangement, which may have
effect of discharge or waiver of personal guarantee(s) or
security.

h. Branch shall also ensure either through a stipulation in an

agreement/ undertaking with the borrower or otherwise, that it
shall not create any charge on the security held in the account
covered by the guarantee for the benefit of any account not
covered by the guarantee, with itself or in favour of any other
creditor(s) without intimating the Trustee Company. Further the
Branch shall secure for the Trust or its appointed agency, through
a stipulation in an agreement/ undertaking with the borrower or
otherwise, the right to list the defaulted borrowers‟ names and
particulars on the Website of the Trustee company.

i. The Branch shall comply with directions as may be issued by the

Trustee Company from time to time for facilitating recoveries in
the guaranteed account, or safeguarding its interest as a
guarantor, as the Trustee Company may deem fit.

j. Branches to submit data points, as per the requirements, to track

the outreach and impact of the scheme.

24. Other While considering / releasing this facility at branch level it is to be

Conditions strictly ensured that:

a. Justification for allowing UGECL facility to be put on record by

the Branch/ Sanctioning Authority. It should be ensured that the
requirement is need based.

b. The adjustment of limits to be monitored as per the extant

Credit Monitoring Policy of the Bank.

c. The facility not to be utilized for adjustment/takeover of

borrowings availed from other Banks/FIs.

d. Further, Borrower has to submit the request for availment of

UGECL limit to the branch with justification / reason thereof and
same should be acceptable to the bank.

e. Enterprises engaged in speculative activities/NBFC/

MFI/HFCs/Bank/ Staff accounts/SOD (against Deposit/NSC/KVP/

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 Union Guaranteed Emergency Credit Line (UGECL)

Sl. No. Parameter Details

Insurance policy etc) are not eligible for finance under this
scheme.

f. A suitable undertaking to be obtained from the borrower with

regard to end use of fund and that the amount will be used for
the business purpose for which original limit was sanctioned.

g. All other terms and conditions as per extant guidelines of the

Bank to be complied.

h. There should not be any diversion of funds from their account for
the purpose other than which it was approved.

i. The business enterprises should be a going concern.

j. UGECL facility may result in dilution of existing security

coverage, the same will not affect the pricing / modalities of
existing schemes.

k. The limit under UGECL will not be reckoned for any dilution of
DP if any in the account.

l. Records such as pre / post sales, inflow of stock & book debts,
bills /vouchers if applicable, any other proof should be kept in
file and provided for audit.

m. In view of the lockdown and restrictions in the movement in

many parts of the country, eligible customers can also apply /
can approach directly to Branch/ Offices or through e-mail/
Marketing officer/ Bank Mitras and other digital mode of
communication for UGECL facility.

n. All existing terms and conditions of existing regular sanction to

be applicable for limits allowed under the scheme.

25. Relaxation Any relaxations in the Union Emergency Credit Line Guarantee
Scheme shall be permitted by CAC:II & above on case to case basis.

_________________________________________

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 Union Guaranteed Emergency Credit Line (UGECL)

Annexure A to Annexure I
FORMAT FOR SANCTION OF UNION GUARANTEED EMERGENCY CREDIT LINE
NOTE FOR SANCTION OF UNION GUARANTEED EMERGENCY CREDIT LINE (UGELC)

A. Borrowing Units Profile:

1 Name of the Branch Code
2 Regional Office/ Zone
3 Cust ID
4 Name of the Unit:
5 Constitution
6 Date of Incorporation
7 Segment :
Business Enterprise/ MSME/ PMMY
borrower
8 Whether Govt. Undertaking/PSU Yes/ No.
9 Company/ Entity Details
a CIN
b TAN
c GST No (In case business activity
didn‟t require GST detail thereof ).
c1 Last GST file date
d LEI No
e No. of employees
f Monthly wage/salary outgo
10 Ownership/Group
11 Borrowing entity dealing with us
since
12 Group dealing with us since
Banking Arrangement Sole/Multiple/Consortium
13 Activity Non-Trade/Trade/Services
14 Details of Activity
15 Industry
16 Promoters Details
a Chairman/MD/
Directors with DIN number
b Promoters/CEO/CFO
17 Addresses:
a) Registered Office
b) Corporate Office
c) Works(Major Locations)
18 Brief History of the Unit/ Borrower/ Management / Promoters (Max 20 lines/ 4000
characters):
19 Whether unit impacted by COVID-19 Yes/No
pandemic
20 Whether Unit/Work was open/closed in Yes open/Partially Open/Not open
Lockdown
21 Reasons for requiring facility under UGECL:

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 Union Guaranteed Emergency Credit Line (UGECL)

22 Last inspection/visit done of the units:

23 Last Internal Credit Rating
Last Internal credit rating date
Last External Credit Rating
Last External credit rating date
24 Date of sanction / Last review
Sanctioning Authority (Previous Sanction)
Due date of review

B. PROPOSAL FOR CONSIDERATION:

To consider sanction of Working Capital Term Loan of Rs._______ (Rupees
____________________________) to provide liquidity support to the company affected by
COVID-19 Pandemic under UGECL scheme.

B1. Exposure to the Borrower (Existing & Proposed)

i. Current outstanding:
(Amount In Rs. )
Limits Existing (current )
O/s of the O/s of the Name of the MLIs
borrower with borrower with
our Bank various MLIs
On Balance Sheet
Exposure
Total FB-WC (i)
Total FB- TL (ii)
Total FB- WCTL (iii)
Total (i+ii+iii )

ii. Outstanding as on 29.02.2020

(Amount In Rs. )
Limits (o/s as on 29.02.2020)
O/s of the O/s of the Name of the MLIs
borrower with borrower with
our Bank various MLIs
On Balance Sheet
Exposure
Total FB-WC (i)
Total FB- TL (ii)
Total FB- WCTL (iii)
Total (i+ii+iii =A)

B2. Credit Limits (Company & groups)

Exposure Company Group
Existing Existing
Fund Based
Non-Fund Based
Investments
Total exposure

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 Union Guaranteed Emergency Credit Line (UGECL)

B3. Conduct of Account

Nature of Limit with our Outstanding Irregularity, if any Comment on
Facility Bank Compliance of
sanction
terms

B4. Bank wise details of limits (in case of MBA/Consortium)

Sharing pattern under Multiple Banking / Consortium arrangement:
Name of the Lead Bank: ________________________
Bank Existing Proposed
FB NFB Total % FB NFB Total %
1.
2.
3.
4.
Total 100.00

C. BORROWER / ACCOUNT INFORMATION:

Parameters Remarks
a. Whether CRILC is applicable in account Yes/No
b. If yes whether CRILC generated Yes/No
c. Status of the account as per CRILC
d. Whether CICs(CIBIL etc) report generated Yes/No
e. Comment on the status of account in CICs (CIBIL) reports
f. Current status of the account with our bank
g. Status of the account with our Bank as on 29.02.2020
h. Current status of the account with other bank etc
i. Status of the account with other Bank etc as on 29.02.2020
j. Annual Turnover in FY 2019-2020
k. In cases, where accounts for FY 2019-2020 are yet to be
finalized/ audited declaration to be obtained.
Borrower‟s Declaration of Turnover :

1. SECURITIES: (PRIMARY/COLLATERAL):

1.1 Details of Guarantor:

Personal / Corporate Guarantees:
(Names, Means/ TNW)

2. ASSESSMENT:
(Amount in Rs. lakh)
Total value of O/s loans as on 29.02.2020 (A)
20% of A (B)
Loan sanctioned ( C)
(Kindly note its upto 20% of o/s as on 29.02.2020)
*In case of Multiple Banking, based on scenarios the assessment shall vary.

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 Union Guaranteed Emergency Credit Line (UGECL)

3. MARGIN: NIL

4. RATE OF INTEREST: 7.50% FIXED

5. REPAYMENT: A moratorium of ____ months from the date of first disbursement is

provided, thereafter repayment in _______Equated monthly instalments (EMI) of
Rs_____________________ to be paid.Interest to be serviced as and when applied
during moratorium.

6. Delegation (as per UGECL scheme, delegation shall be in line with existing sanction):

7. Terms and Conditions:

i. The facility not to be utilized for adjustment/takeover of borrowings availed
from other Banks/FIs.
ii. An undertaking will be obtained from the borrower with regard to end use of
fund and that the amount will be used for the business purpose for which
original limit was sanctioned.
iii. All terms and conditions as per UGECL scheme guidelines of the bank to be
complied with.
iv. There should not be any diversion of funds from their account for the purpose
other than which it was approved.
v. Funds must be utilized for business purposes like payment of statutory dues,
procurement of raw materials, payment of creditors, etc. The business proposals
should be otherwise viable and it should do well after dispensation of UGECL.
vi. Records such as pre / post sales, inflow of stock & book debts, bills /vouchers if
applicable, any other proof should be made available provided for audit.
vii. All other terms and conditions as per the circulars on UGECL are to be adhered
to.

8. RECOMMENDATION:

Signature of Recommending Authority

Date: Designation:
Place: Name:

Comments of sanctioning authority:-

Sanctioned
Rs.______________(Rupees________________________________________)

Date: Signature of Sanctioning Authority

Place: Designation:
Name:

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 Union Guaranteed Emergency Credit Line (UGECL)

Detailed Terms & Conditions

Facility Working capital Term Loan
Limit (Rs.)
Purpose To meet the liquidity crunch and cashflow mismatch on account of
outbreak of COVID-19
Loan Tenor ____ months
Moratorium ____ months
Repayment ____ EMI of Rs………………. after moratorium.
Schedule
Rate of 7.50% Fixed
Interest
Margin NIL
Guarantee
Details
Security
documents
Security Primary
Detail Collateral
Other Terms &
conditions

SANCTIONED / DECLINED

Date: Signature of Sanctioning Authority

Place: Designation:
Name

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 Union Guaranteed Emergency Credit Line (UGECL)

Annexure B to Annexure I
UNDERTAKING LETTER FROM BORROWER/S

From Date:
____________ Place:

To
Union Bank of India
____________

SUB: REQUEST CUM UNDERTAKING LETTER FOR DISBURSEMENT OF LOAN

REF: YOUR SANCTION ________________________ DATED ______________

In light of the liquidity / cash flow mismatch on account of the present outbreak of COVID- 19,
at my/our request, Union Bank of India vide Sanction Memorandum ________ dated ______ has
sanctioned a fresh Working capital Term Loan of Rs ___________,under UGECL scheme (strike
off whichever is not applicable) on various terms and conditions contained in the said Sanction
Memorandum.

We hereby convey our acceptance to the terms and conditions contained in the above said
Sanction Memorandum and request you to release the limit/loan as sanctioned.

I/we request you to release the loan sanctioned and I / We hereby agree, undertake and
confirm as follows:

1. That necessary approval has been taken from the Board of Directors/General Body for
availing the above said additional loan (Clause may be included as applicable).
2. I undertake that the sales turnover of the ______________________(name of the
borrower) does not exceed Rs.100 Crs during the FY 2019-20.
3. That the availment of above said loan is in tune with the Memorandum and Articles of
Association of the Company (Clause may be included as applicable).
4. That the existing securities created in favour of the Bank by way of Hypothecation /
Pledge / Mortgage shall continue as security for new UGECL loan sanctioned also.
5. That I/we shall not create further charge on the securities mentioned in the above said
Sanction in favour of any Bank/Financial Institution/person without prior approval from
you.
6. That the release/disbursement of the Fresh Limits/Loan to my/our Loan Account shall
be deemed as my/our acknowledgement of receipt of the above additional facility
sanctioned to me/us.
7. That the funds will be utilised for the business purpose for which original limit was
sanctioned. Funds shall not be utilised for any speculative purpose.
8. That I/we shall execute the necessary documents for creation of securities as prescribed
by the Bank within three months (90) days from the date of disbursement.
9. That I/we shall not create any charge on the security held in the account covered by the
guarantee for the benefit of any account not covered by the guarantee, with itself or in
favour of any other creditor(s) without intimating the bank.

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 Union Guaranteed Emergency Credit Line (UGECL)

10. That I/we shall give the rights to Bank / Trustee Company of the guarantee, that in case
of default, our names and particulars can be published on the website of the Trustee
Company.

I/we hereby agree to keep the Bank indemnified for any loss or damages that the Bank may
suffer or incur on account of the sanctioning/disbursing the above said credit facilities to
me/us.

Signed, sealed and delivered by the

within named BORROWER and GUARANTOR

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