Andhra Bank
Skip to navigation | Skip to main content

Toll Free Number : 1800 425 1515

OTS Scheme - MSME
Click here to view FAQ
imageCoverage of Scheme

NPA accounts including decreed accounts with real balance of upto Rs.10 lakh and NPA accounts under MSME category which are classified as Doubtful and Loss Assets as on 31.03.2015, are eligible under the Scheme.
image Exclusion from the Coverage of Scheme:
  • Accounts classified as Sub-Standard Assets,
  • Accounts eligible for Debt Waiver Scheme.
  • The liability is secured by liquid securities.
  • The accounts where loan is sanctioned on the basis of Salary undertaking Letters given by the employers.

image Operative period
The scheme will be operative from 29.05.2015 to 30.09.2015..

image Settlement Formula:
The settlement formula for loan upto Rs.10.00 lakhs and for loans above Rs.10.00 lakhs (MSME a/cs Only) are as under::

Date of NPA

Settlement Formula
Upto Rs.10.00 Lakh Above Rs.10.00 lakh (MSME a/cs only)*
01.04.13 to 31.03.14 70% of Amt. in default 90% of Amt. in default
01.04.11 to 31.03.13 60% of Amt. in default 80% of Amt. in default
01.04.09 to 31.03.11 50% of Amt. in default 70% of Amt. in default
On or before 31.03.09 45% of Amt. in default 55% of Amt. in default
A/cs. T. W.Off  45% of Amt. in default 45% of Amt. in default
a) Amt. in default= Real account balance as on date of NPA + all Charges debited after NPA + CGTSME/ECGC received & appropriated to loan a/c Minus recoveries after date of NPA.
*Settlement formula for accounts with Real balance above Rs.10 lakh:

  1. The Settlement formula for accounts backed by tangible securities would be higher  of the ( a ) or (b) or (c) as below:
  1. Net Present Value (NPV) of available securities [Primary as well as Collateral including Securities attached by the court before Judgment (ABJ),] NPV will be calculated with 3 years realization period at prevailing Base Rate + 4%.
  2. OR

  3. Distress Sale Value of the Securities (valuation is not more than 2 years) (If no distress sale value is specified in the valuation report, 80% of the fair Market Value of Securities may taken as the notional amount)    
  4. OR

  5. Settlement Formula as above
image Payment Terms:

The settlement amount arrived at as above, should be paid in one lump sum amount without interest within 30 days of acceptance of OTS offer. In deserving cases, the settlement amount may be recovered in installments within a maximum period of 90 days from the date of acceptance, by depositing  at least 25% of the settlement amount as down payment..

image Special Incentive:
 -A Cash discount upto 10% on the OTS amount so arrived will be allowed, to all eligible borrowers who pay the OTS amount in one lump sum immediately or within 10 days of receipt of OTS offer letter from the Bank.  

For further details/clarifications, if any, the borrowers may contact the branch concerned.