Bill Of Discounting
MyLoanBazar.Com provides customized financial solutions through a single window for all your Purchase and Sale Bill Discounting and also Invoice Discounting to Small, Medium & Large Corporates.
In Bill Discounting, Financial Institutions / Bank, takes the bill drawn by Proposer on his customer and pay him immediately deducting some amount as commission or discount. The Bank then presents the Bill to the Proposer's customer on the due date of the Bill and collects the total amount. If the bill is delayed, the Proposer or his customer pays the Bank a pre-determined interest depending upon the terms & conditions of transaction which has been executed between the Borrower & Bank
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Bill Of Discounting→ Eligibility
Bill discounting is a perfect way to meet the financing needs in the business cycle and fulfil the inherent obligations. Any business can avail bill discounting facility from a bank. In this facility, the bank will buy the bill which is due and then credits the value to the customer’s account.
Eligibility criteria involved with bill discounting include:
Bill discounting facility is extended based on the credit worthiness and performance of the business.
This facility is offered only in cases where a bill is usance bill
It has to be a trade bill/s
The bill must have at least two signatures from either reputed individuals or bank or companies
It must have been accepted and bear at least two good signatures (e.g. of reputable individuals, companies or banks etc.)
The Bank will normally act only for discount trade bills
Bill discounting is offered only up to a period of time, in most cases it’s 180 days
The list of eligibility criteria is not inclusive as banks may put in some additional norms for bill discounting purposes. Visit MyLoanBazar.com to know more about eligibility norms in bill discounting.
Bill Of Discounting →Documents
Sr. No. Documents type Required documents
1 Id proof Copy of, passport / pan card / voter id card / driving license/ ration card / adhaar card
2 Address proof Copy of , passport/utility bill/voter id card / driving license/ ration card / adhaar card
3 Age proof Copy of, passport/ pan card/driving license/birth certificate/ration card
4 Signature proof Copy of, pan card/bank authorized letter
Sr. No. Required documnets
1 4 photograph for applicant & co-applicant
2 Company profile (history, background & growth) + director / partner / proprietor (background,
3 Latest list of director & shareholding pattern on letter head attested by ca
4 Net worth statement of all director attested by ca
5 Latest sale tax/service tax/ vat/cst/certificate of registration
6 Copy of moa/aoa/partnership deed (as applicable)
7 Copy of latest vat of till date for latest financial year
8 Copy of provisional balance sheet and profit & loss a/c
9 Last 3 year, itr + computation of income + auditor’s report +profit & loss+ balance sheet with complete schedule
10 Last 6 month bank statement of all running bank accounts of company
11 Last 6 month bank statement of all running bank accounts of director / partner / proprietor.
Sr. No. Required documents
1 Copy of property paper with complete back chain
2 Copy of sanction plan
3. Copy of latest house tax receipt
Sr. No. Required documents
1 Copy of sanction letter & amortization schedule of all running loan.
2 Latest statement of account of all running loan
3. Copy of loan closure letter / noc, if any loan closed in last 6 month.
5. Copy of work order in hand
Bill Of Discounting - Process
Bill Discounting has a standard process which remains more or less similar with all banks. The process is based around the logic of discounting a bill and giving relief to both the parties involved, buyers and sellers.
The process involved with bill discounting include:
First of all, the seller has to approach the financing company to discount the bill.
In the next step, the financing company checks the legitimacy of the bill.
After that, it assesses the creditworthiness of the buyer
The financing company charges fees, deducts margin and discount
The company gives the fund to the seller, which is then used for further business
Based on the agreement, either the seller or the financial intermediary will collect the fund
Visit MyLoanBazar.com to know more about the process involved with bill discounting.