Frequently Asked Questions
Getting started with Capri Global
Find answers to all your questions here. Browse through these FAQs to find answers to commonly raised questions. If you are going to avail our loans, we encourage you to read through the relevant articles.
How do I approach for loan?
Fill up enquiry form at website or contact at the customer care no’s, we will love to serve you.
What Documents are needed for approving a loan?
At Capri we ensure that minimum documents are collected and evaluation is done of your proposal. We require below mentioned documents: ID proofs, address proofs, Bank statements, Property Papers, Financials
How many days you take to sanction a loan?
At Capri each case undergoes a thorough evaluation process. We normally take 7 to 15 working days to decision the loan depending upon sufficient fulfillment of requirements.
What Charges do I need to pay along with interest?
Kindly refer the section schedule of charges.
What type of installment options are available to me?
Capri offers Equated instalment as well as Structured installment options for tenors 12 to 120 months.
What type of properties are funded by CCGL?
You can speak to the Relationship Manager for more details on this.
We have customized income programs to calculate your loan eligibility which takes into account your actual income. We will determine your loan eligibility largely by your income and repayment capacity and collateral offered. Other important factors include your age, qualification, number of dependents, your spouse’s income (if any), Other Income, Assets & Liabilities, Savings History and the Stability & Continuity of occupation.
Our interest rates depend upon creditworthiness and market conditions.
Your requirement is assessed on the following parameters: Quantitative Parameters 1. Financial Ratios 2. Sales Turnover and Profitability Record 3. Credit History Qualitative Parameters 1. Management Details / Shareholding Pattern 2. Understanding Business Models through Personal Discussions 3. Industry
Minimum age of the self employed applicant should be 25 years & Maximum age of 65 years.
Following will be taken as security 1. The Asset financed (Equipment proforma Invoice mandatory prior to disbursement in all cases) 2. Hypothecation endorsement in the invoice and insurance (Including Transit Insurance) to be present before disbursement of loan along with Equipment Loan cum Hypothecation agreement. 3. Additional Property collateral or any suitable collateral such as Fixed Deposits and LIC policies (as specified from time to time by us)
The rate of interest varies depending upon your loan amount, property type, income etc and this will be communicated to you by our sales representatives.
The stages involved are: 1. Application 2. Processing 3. Documentation 4. Sanctioning of the loan 5. Disbursement
Still have questions?
Before we get into the reforms and policies being established by the government to help deal with the liquidity crunch, let’s briefly discuss what got them there- the IL&FS crisis of 2018. During August 2018, Infrastructure Leasing and Financial Services defaulted in the repayment of their obligations to SIDBI. At the time, no one suspected that the NBFC/HFC industry, with an asset book of 28.4 lakh crore, would take the hit. As time progressed, people started to draw an unjust comparison between the two. This resulted in the distress of India’s capital market and the subsequent current liquidity crunch for NBFCs.
To prevent the downfall of the credit market in the country, RBI and the government have created a few temporary reform policies to pull NBFCs out of crisis mode and back on the track of growth:
- Union budget 2019-20- To dissuade the unduly risk-averse, the government will provide a one-time six months partial credit guarantee to PSBs for the first loss to the extent of 10% to support a total investment of 1 lakh crore in financially stable NBFCs. NBFCs in India have significantly contributed to boosting consumer demand and capital formation, and the default of a few shouldn’t affect all.
- Increased Exposure limit- As of 1 April 2019, the guidelines on large exposure framework has been revised to allow the flow of credit to priority sectors. The central bank increased the exposure limit to one NBFC to the extent of 20% from 15% of the Tier-1 capital of a bank, and under specific circumstances, this limit may be raised to 25%. The agriculture and MSME sectors contribute significantly to the economic growth of the country and NBFCs that lend to them can borrow up to 10 lakhs and 20 lakhs, respectively.
- Infused Capital into PSBs- The government will infuse a capital of Rs 70,000 crore into public sector banks as a measure to relieve liquidity stress and foster the flow of credit. Addressing the liquidity crunch along with the other policies put in place will reassure banks investing in the assets of highly rated NBFC. Additionally, the government is also encouraging banks to borrow from NBFCs and has allowed NBFCs, in turn, access to Aadhaar-authenticated KYCs to simplify the credit process.
The economic growth of our nation depends to a great extent on the credit lent by NBFCs, justifying the numerous initiatives being taken by the government to ease the crisis. However, the views on whether these reforms will actually help improve the situation are divided. Although these initiatives have forced a perspective shift for banks from neutral or averse, to accommodating, there’s yet a long way to go to revert the damage done.
Some NBFCs like Capri Global have progressed in the steady march towards growth while others have permanently closed their doors. On the bright side, the fear of the liquidity crisis escalating to a solvency issue hasn’t happened. If one thing is certain, it’s that NBFC have, are and will remain an essential part of the economy and we’ll have to wait and see what their future holds.
While a few NBFCs exhibited robust growth, most disruptive and conservative NBFCs weren’t left unscathed by the current downtime. And though the government has created reforms and policies to get NBFCs back on track, the road ahead is neither short or smooth, making it important to strengthen their risk management frameworks.
Risk management impacts and NBFCs potential to attract raise funds from primary markets in the short-run and enlist on the stock exchange further down the line. Financial institutions can no longer afford to sit back and wait for yet another disaster to strike but must proactively identify and mitigate both internal and external risks. An ASSOCHAM report that was released shortly after the liquidity crisis of 2018, identified the key risks faced by NBFCs and the risk management techniques to manage liquidity and avoid insolvency:
Credit risk- A Credit Risk for Indian Corporates report in 2015, found that though the average default risk of Indian organizations has improved since 2008, their risks have also remained higher than for those of other Asian, US and European firms. The management of credit risk involves setting up standards and policies for operating procedures that are reviewed on a regular basis. To mitigate this risk, NBFCs a robust system of credit line management for various transactions including over-withdrawals, loan approvals, account inactivity, etc are necessary. These measures must also be audited internally to ensure that the company stays on track.
Vendor risk- The vendor risk management market size is expected to grow from USD 3.29 Billion in 2017 to USD 6.50 Billion by 2022. Outsourcing activities such as data entry, documentation, and field verification to third-party vendors, leaves them open to a plethora of risks. In order to minimize their exposure, the vendors they deal with must be carefully selected through an unbiased system that solely considers the service providers operating model and qualification to meet their needs. These services must also be supervised and audited to ensure quality, with penalties for the failure of meeting service levels.
Compliance reviews- The recent influx caused by the NBFC crisis and regulations set for NBFCs has made conducting compliance review compulsory. The companies should create a comprehensive framework that ensures it adheres to the guidelines set at all times.
Quality control- Apart from the above risk management techniques, quality controls must also be carried out to ensure that the functions of non-banking financial institutions are in line with the standardized stipulated processes.
Information and data integrity- Financial institutions have access to a significant volume of confidential customer data which needs to be secured against leaks. Data breaches of any kind could affect the finances of customers and in turn the reputation of the NBFC. Cybersecurity is key to maintaining the integrity of the data and the company.
They often say lightning never strikes the same spot twice, but the IL&FS crisis seemed to have sent the NBFC sector into a downward spiral with no foreseeable end. What started out as a default by one company, resulted in a domino effect that adversely affected the NBFC sector and in turn a decline in the growth of GDP. If effective risk management models and risk management processes are put into play in the NBFC sector inadequacies can be detected and rectified before it escalates into a crisis.
As one such NBFC, Capri Global assesses the risks posed and have counter measures in play to overcome them. We firmly believe that traditional financing needs to be reoriented for the informal sector, while we leverage technology to foster an air of trust and transparency that helps us serve customers better.
Our field-based credit assessment with robust risk controls enables us to evaluate risks and ensure adherence to stringent standards of governance and regulatory requirements. Our branch network let us take a relationship-driven approach with each customer at a local level. This helps us arrive at an optimal home finance requirement, speed up disbursal and ensure regular and disciplined collections.
Even as a developing nation, economic growth, and opportunities across the major cities are now well on their way towards being saturated. And, what happens when the fastest growing cities in India aren’t developing as fast anymore? No. This doesn’t mean the end of development or progress but rather a chance to go beyond Tier 1 and into Tier 2 and Tier 3 cities that have the potential to make a real difference. Future-ready businesses have not failed to see and seize this opportunity.
It’s time to shift focus from the 300 million that are already aware, to the 500 million that have been ignored all these years. India has the second-largest number of internet users with the numbers reaching a staggering 563 million. Retail, IT and housing finance organizations are among the pioneers to capture these untapped markets.
Why MSMEs are turning to Tier 3 and Tier 3 cities
The MSME sector contributes to over 45% of the industrial output and 40% of the country’s exports. The entrance of these players in these under-served markets will back the urbanization of rural India. Here’s why the sector has shifted their focus to these cities:
- Lower land cost and rent charged- Investment necessary to set up shop in a smaller city is generally significantly less, when compared to metros. There’s more land and rental space available at a lower cost.
- Availability of talent- Gone are the days when the cream of the crop needed to leave their home towns in search of better education, better jobs or a better life. Today, thanks to the connectivity that technology has brought in, millennials have started returning to their home-towns upon completion of their formal education. Talent is presently easily available in these cities with lower salary slabs.
- Widen customer base- Many MSMEs address problems that are geographically agnostic. Entering these markets serves as a way to create networks, feel the pulse of the cities and produce goods and solutions that meet their needs.
Loans- The Foundation for Growth
MSMEs today contribute to over 25% of the country’s GDP and this number is only set to rise. They create an abundance of opportunities for growth and employment in the nation but need the funds to do so. Loans help these organization meet their capital and day-to-day expenses. Banks are presently able to meet only 40-70% of the MSME sectors financial requirements that account for $55 bn in the present.
So where should they turn to bridge this gap?
NBFCs are the answer. Non-banking financial institution in India are an optimal source for MSME loans because they have tailored offers for the sector with certain allowances that make them a more flexible, viable option. The terms of interest and repayment NBFCs offer are also personalized to serve the underserved and ensure the flow of credit in the economy.
In the long- run the progress of a nation depends on the well-being of the whole and not just a few parts. For India to continue on the path towards being a developed nation, organizations must go beyond the big cities and execute change across the country.
How Capri Global is Capitalizing these markets
As a leading NBFC in India with a focus on urban development, Capri Global Capital hopes to lend over Rs 7,000 crore by providing home loans and MSME loans in these smaller cities. The company sees the need to create a network of branches across and plans to expand its operations from 84 to 232 branches in the next five years.
Although the liquidity crisis of 2018 sent the NBFC sector into a bit of a slump, Capri Global managed to achieve a growth of 45% and has confidence that the books this year will also reflect a similar level of progress. During an interview with ET Now, Rajesh Sharma, Managing Director of the firm addressed the fact that each city is different, and an understanding of these variations is what will give them an edge in Tier 2 and Tier 3 markets.