The Executive, Borrowings and Investment Committee of CreditAccess Grameen’s Board of Directors on Tuesday approved the terms and conditions for issuance of non-convertible debentures (NCDs) aggregating ₹86 crore in favour of Union Bank of India and Bank of Maharashtra.

The NCDs, which are of ₹10 lakh face value and of 18 months tenure, carry a coupon rate of 9.25 per cent per annum.

The payments toward interest/coupon will be made annually, on August 14, 2021 and February 14, 2022, and the debentures will be redeemed by way of a bullet payment on February 14, 2022, Bengaluru-based CreditAccess said in a regulatory filing.

The debentures are proposed to be guaranteed by the Government of India pursuant to the scheme dated May 20, 2020 on ‘Extended Partial Credit Guarantee Scheme’, it added.

CreditAccess said the NCDs are secured by way of a first ranking and exclusive charge on receivables to the extent of 110 per cent of the aggregate of the outstanding principal amount of debentures, together with any accrued interest, additional interests, costs, fees, charges, and other amounts payable by the company.

As per the filing, additional interest at the rate of 2 per cent per annum above the interest/coupon rate will be payable on the outstanding principal amounts from the date of the occurrence of any default in the payment of any interest/principal amounts (subject to the cure period set out in the debenture trust deed) until the date on which such default is cured or the debentures have been redeemed in accordance with the provisions of the debenture trust deed.

The company is registered as a non-banking finance company-microfinance institution with the Reserve Bank of India.

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