SIDBI Term-Loan Assistance for Rooftop Solar PV Plants (STAR)

Small Industries and Financial Bank of India has launched a new scheme known as SIDBI Term-Loan Assistance for Rooftop Solar PV Plants (STAR). 

SIDBI has addressed one of the major issues of MSME related to renewable energy and its cost of power generation.  

However, it can be resolved, and the cost of power can be reduced by replacing existing grid cover by solar power.  

To help units SIBDI is providing financial support under the STAR Scheme. 

The objectives of STAR Scheme  

The objective of SIDBI under the SIDBI Term-Loan Assistance for Rooftop Solar PV Plants (STAR) Scheme is to help the MSME sector in reducing their power bill.  

The key features of SIDBI Term-Loan Assistance for Rooftop Solar PV Plants Scheme 

• SIDBI provides 100% finance under STAR Scheme.
• There will be zero contribution by the promoters.
• Simple loan documentation
• Direct payment to supplier
• Cover of credit guarantee is available.
• It can be obtained at an attractive interest rate.
• FD of 15% to 25% of loan
• There will be fast disbursal and loans will be sanctioned quickly.

Eligibility criteria for STAR Scheme 

The eligibility criteria for getting a loan under the STAR scheme are as follows: - 

• Cash profit for the previous 2 financial years.

• The business vintage for new customers is 4 years and for existing customers it is 2 years.

• Satisfactory repayment track record.

• Only On-site projects are funded under this scheme.

• The maximum loan amounts up to 25% of the NET Sales.

• Scheduled Solar rooftop capacity should not exceed connected load.

• The minimum IACR of 0.5% for new customers (if no CGTMSE Cover)

• Both stand alone and grid connected are covered.

Eligible Units  

• The MSMEs with a minimum existence of 4 years & cash profit for the previous 2 years can reduce power bill by installing rooftop solar plant with 25 KW to 500 KW capacity under this scheme

Quantum of Assistance of STAR Scheme 

Under the STAR Scheme by SIDBI, it provides the loan amount from Rs. 10 lakhs to Rs. 250 lakhs to the borrowers. 

The interest rate of STAR Scheme 

• The rate of interest of SIDBI Term-Loan Assistance for Rooftop Solar PV Plants (STAR) scheme is 9.10% to 10.20%.

The loan tenure and Moratorium of STAR Scheme 

The repayment tenure depends on the risk, cash flow of the unit and project implementation schedule. 

Small Industries and Development Bank of India (SIDBI) provides a tenure of up to 5 years with a moratorium period of 3 to 6 months to the eligible units.  

Documents required for the STAR Scheme  

Listed below are the documents required for SIDBI Term-Loan Assistance for Rooftop Solar PV Plants (STAR) Scheme: -   

• Income Tax Returns of promoters with IT assessment order for previous 3 years.
• List of proposed and existing stakeholders & holding pattern with the name of stakeholders, etc.
• KYC Documents (for an individual)
• KYC proof of mortgagors, guarantors.
• Proof of address if there is any change in the address of registered factories or office.
• Previous 3 years of annual accounts of the borrower units.
• Memorandum of Association of the borrower’s company, copy of registration certificate along with the registration of firms, and partnership deed of the borrower (if registered).
• Annual accounts of the associate concern, corporations giving the guarantee, group companies.
• Income Tax Return of guarantors with IT assessment order for the last 3 years.
• Recent electricity bill and power sanction letter of existing units.
• AOA and MOA of corporations giving a guarantee.
• Duly filled out electronic application form and profitability projections.
• Copy of approved building plan.
• Estimation of architects for civil works.
• Multiple banking arrangements – Annexure
• Quotations for miscellaneous fixed assets, plant and equipment, and other project heads, etc.

The online application procedure for the STAR Scheme  

• The eligible enterprises require to access the online application page of SIDBI to apply for the scheme.

• The registration page will be displayed on their screen, click on the registration tab to register as a new user in SIDBI to get a loan.

• The entities are required to provide information of enterprise phone number, name, total loan requirements, and email address.

• After the completion of registration, the password and username will be given to the entity.

• Then, log in to the portal and fill in a one-page application form.

• After the verification of KYC documents and due diligence, the loan amount will be credited to their respective account within 48 hours.

Therefore, knowing about the best deals for STAR Scheme. Apply with financeseva. 

Also read: - Top up loan for immediate purposes (TULIP)