LIMIT OF ACCOMMODATION

(i) The limit of accommodation is Rs. 150.00 lacs in case of Co-operative Society, a company or a Corporation and Rs. 90.00 lacs in any other case.

(ii) The Corporation can finance projects with capital outlay upto Rs. 1000.00 lacs in participation with other financial institutions such as HPSIDC and Commercial Banks etc. However, in such cases, the financial assistance from HPFC will ordinarily be limited to Rs. 150.00 lacs.

(iii) HPFC also provides soft loan assistance to the new entrepreneurs who possess necessary skill or practical experience but lack requisite finance for setting up Small Scale Industrial Units in order to meet the gap in the promoters contribution. The soft loan assistance is given to bridge the gap subject to a maximum of Rs. 4.00 lacs or 20% of the cost of the project which is lower, at a nominal rate of interest 1% per annum. Hotel, Restaurant and other tourism related activities are not eligible for grant of soft loan assistance.

(iv) the Corporation also operates on behalf of Small Industries Development Bank of India/Industrial Development Bank of India, the scheme for seed capital assistance for new entrepreneurs where the cost of project is upto Rs. 5.00 crores and requirement of seed capital assistance is more than Rs. 4.00 lacs. The maximum assistance which can be granted with the approval of IDBI/SIDBI is limited to Rs. 15.00 lacs on which the service charges at the rate of 1% in first five years thereafter 10% payable half yearly. This scheme is helpful in establishment of bigger projects upto Rs. 5.00 crores by the eligible entrepreneurs who lack financial resources. Hotel and other tourism related activities are however, not eligible for grant of seed capital assistance.

(v) The rate of interest on term loan in case of tiny units is brought down by way of interest subsidy provided by the Industries department through HPFC to the Industrial units financed by it.