c. Pre-shipment advance to be liquidated within specified period by negotiation/ purchase/discounting of export bills. d. The borrower shall submit packing credit hypothecation stock statement every month so that periodical inspection can be carried out by the bank. e. Where the goods are given for processing "No Lien Letter" to be obtained from the processors. Insurance policy including transit risk to cover stocks sent to 3rd party for processing be obtained. g. Packing credit for shipment to buyers in the countries placed under Restricted cover by ECGC to be disbursed only with the prior permission from ECGC. h. Preshipment advance will be treated as Cash Credit advance if the export does not take place at all. Penal rate to be charged as per RBI/HO circulars issued from time to time, i. Packing credit to be allowed for a period not exceeding 180 days or till such date shipping documents are tendered in compliance of terms of L/C order, whichever is earlier. Due date diary to be maintained to monitor timely submission of documents. Extension beyond 180 days but upto 360 days can be permitted by concerned General Manager after satisfying about the need for the same.
In
exceptional cases extension of shipment beyond 360 days can be permitted after obtaining approval from ECGC. j. The advance will be disbursed in phases depending upon cycle of production/procurement period and delivery schedule. Application to be obtained from the exporter client stating FOB value of the goods which will be initially financed. Freight & insurance premium amount would be disbursed at the time of shipment. k. Bank’s name plate stating "GOODS HYPOTHECATED TO DENA BANK, OKHLA BRANCH’ should be prominently displayed where goods are stored. l. No Packing Credit to be disbursed against the goods received under DA Letter of Credit. m. Packing credit advances are to be liquidated only from the proceeds of foreign bill purchased/discounted/negotiated. Repayment of packing credit advance from local funds shall attract interest at commercial rate prevailing at the time. q. In case of failure by the borrower in complying with the terms and conditions as stipulated above, advance may attract charging of interest at commercial rates.”