Letter to my banker From Mandar Tambe Partner, Parshurama C/A 02/37 Taleigao branch. To The Deputy General Manager, Goa region, Bank of Baroda. 30 Oct 2013 Ref: Clarity and decisive action sought by account holder. Introduction. I opened an account in Sept 2012 at the Taleigao branch on the recommendation of Mr.Hardikar, A DGM, currently in Delhi. in an informal social meeting. On opening an account I met Mr.Tucker , the then DGM and informed him of my targets and intent as an account holder of your bank. My new company registered in Sept 2012 achieved a turnover of approx. 2 crores within one year of inception. In September 2013, I approached the branch manager Mr.Chandya Nayak for a cash credit facility and bill discounting. Mr.Chandya Nayak and other staff members have shown every professional courtesy and support and taken the initiative to guide my small enterprise to success and I thank them and the organisation for the same. Briefly, I belong to a family that has over four generations successfully conducted restaurant trade in Mumbai and my family has restaurants in Mumbai by the name of Tambe Ahar Bhuvan, Tambe Arogya Bhuvan, Aram and I have gone back to the roots and am practicing professional farming for the past 8 years after successfully running many restaurants in Mumbai and being a consultant in New Zealand and London. My farming experience has taught me to secure the market and then produce farm product or the traders eat up the profits. We have hands on skills in vine vegetables, horticulture, fisheries, poultry farming. Chicken is the single most consumed species on the planet and in India and we are securing that market first. In the next two years we aim to capture at least 40% of Goa’s high end hotel market and then introduce other products like seafood, meat, vegetables which we can contract farm. We are inspired by the diety Parshurama, the patron of the Sahyadri mountains and our mission statement is an invocation of His philosophy. Battling Ignorance, Generating Efficiency, Benefits All. Eliminating brokers and bringing agricultural goods to the end consumer at a fair price, securing the producer and paying and value adding landless labour 30% more than the competition, creating a middle management structure from our own rural semi literate employees and making them professionally competitive are the bench marks of our organisation. Currently we are engaged in processing, distributing, whole selling and retailing poultry broilers in Goa and have 4 successful retail outlets by the name of Azra Chicken Centre in Mapuca, Tonca, Bambolim and Vasco. We also supply to other chicken stores like Azavedo farms and Farmer’s Choice in Porvorim, and shops in Calangute,Sothern, Northern beaches, Ponda and Margao. We supply to bakeries, hotels and restaurants. This year we are doing approx. 1500 birds a day and are the third largest chicken business in Goa after Royal Foods(5000 +), Ambika(2500). We have an alliance with Kwality Animal Feeds , Belgaum who are the largest regional poultry producers and now processed product at agreed rates are delivered to us and then after further value addition are packed and supplied to many 5 star, 4 star hotels in South Goa and North Goa including Mandovi, Goenchin, Fidalgo, Hyatt, Niaz, Mainland China, Sher E Punjab just to name a few of our elite clientele. We have also created new clients who will bring additional revenue over and above our current trade to the tune of minimum 1.5 lacs a day. We anticipate, on successfully servicing these customers this year, we will achieve a turnover of 7 crores plus. We have lined up other high demand products like Vietnam imported Basa fish, de shelled tail on prawns and White Pekin meat ducks. We enjoy excellent relationships from our farmers and buyers and have earned a reputation for fair price, consistent quality and unfailing delivery of material in one year, the year in which the worst price rise of poultry products took place since the last two decades of the poultry trade. We look to our bankers, Bank of Baroda with faith and confidence. Requirements. Our customers like Hyatt, Fidalgo etc require to be given credit for 45 days. This can sometimes extend to 60 days. Some hotels pay in 30 days. Some upto 2 months. But these are proven entities of repute and we require Invoice/ Bill Discounting facilities from your bank to service this business. We also require cash credit facilities. I have been given to understand that we are eligible for a Cash Credit facility of about 50 lakhs. I also understand that technically a cash credit facility need not have a co lateral , I understand the reality of the financial institutions and hence to enjoy the facility of CC I have offered a co lateral, a residential apartment in Pune city owned by my wife, Nishita Tambe who is also a partner in the business. The property currently enjoys a loan from Bassein Co Operative Bank , Akurdi branch, Pune, having its head office in Marol ,Mumbai. My immediate requirement for funds is due to the fact that business in Goa is seasonal and I am obliged to commence supply to many prestigious institutions from the 9th of November 2013. Failing to do so or any delay in the same will mean loss of turnover of at least 3crores of rupees and ceding hard earned business to the competition and loosing advantage in a very , very competitive environment. BILL DISCOUNTING. We deliver to the customer and are asking for bill discounting facility. I am getting NO RESPONSE or CLARIFICATION on this for the last 2 months and am being forced to go away from my parent bank to Tata Capital whose costs are more but who are not asking for co lateral nor LC from customers bank. They are content with letter of credit from the customer and the commitment from the customer that payments will be made directly to Tata Capital account. I , in turn am happy to have my account auto debit the payment I receive from bill discounting , to my principle suppliers Kwality Animal Feeds. The bill discounting is happening AFTER goods have been received , acknowledged and stamped by parties and no risk of perishable materials is borne by the lending institution. The parties for whom we request Bill Discounting are reputed National and International Companies. If Tata Capital can give us this facility, why is my Parent Bank not even discussing this me? Cash Credit. I have offered a co lateral. Legal opinion has been forwarded. Valuation reports have been submitted. I have personally got after this and completed this so as to save time. Verification of premises by Bank officer is complete. Specific NOC from the current mortgage holding institution has been procured. All documents relating to guarantors, company papers, conception, inception , registration have been complied with. Machinery worth 12 lakhs is also offered as co lateral and the original bills for same have been submitted. Bank of Baroda has proposed taking over the housing loan and the balance value to be treated as co lateral against CC. Also, further co lateral of machinery is available. To date, I do not have an assessment of how much the bank wishes to grant me for CC after taking possession of my property and machinery and YET I have the FAITH from my experience with the officers of the branch that I will get the best possible service and facility. Problem . I was informed that my wife’s income having reduced over the last three years, she is not meeting the credit worthiness to take over the current loan .(24 lakhs plus.) My wife was employed as a teacher and had fixed deposits and investments which were dissolved to invest in the business and she is actively working as a partner in the company. Achieving a turn over of 2 crores in the 1st year itself amply justifies the situation. Yet, my elder son, Rishabh Tambe, who is also a partner in the company enjoys income too and I proposed that he be taken a s a co borrower. On doing so , it was found that the credit worthiness criteria was met. Yet again, the next day, I was informed that in the case of a take over from another bank, the exact term and nature of the previous loan needs to be followed and there can be no co borrower. Now we found that eligibility was 19 lakhs odd and there was a shortfall of about 5 lakhs of rupees. Speaking to my suppliers , friends and family and some EXPENSIVE money lenders, I raised 5 lakh rupees in 48 hours so that I could clear the surplus and facilitate the bank’s takeover of the housing loan on their required terms. I have made a request that I am willing to pay the higher interest of Cash Credit facility if my property is taken as a co lateral and a full cash credit facility is given to me and from this facility, the bank in Pune’s loan may be deducted. Now , Bank of Baroda declines making my son a co borrower on one ground, and questions my wife’s future paying ability declining all explanations from us, declines the offer from the company and its partners that the company is willing to stand guarantee to pay the loan and in fact brings forth the notion that “What will happen if our business fails and Nishita Tambe also fails to be income generative?”As a successful business person, I am at a loss in answering such a query .Now do you require a co lateral for a co lateral? Guarantors have been provided. Co laterals have been provided. Now a co lateral for the guarantor and co co lateral for the co lateral? Strange. There are also question marks about 100% cc and paying off debt from it to take over the co lateral? Every day , I am trying to meet the mysteriously shifting requirements proposed by your institution while I am seeing my deadline for 9th of November fast approaching. I have made repeated requests for an appointment with the DGM or the DRM but it seems I represent no value to the institution or my problems are not worthy of a hearing. I revisit my days in Vashi market trying to sell my goods while traders try to beat me down in price and finally I throw all my cucumbers in the gutter and go back to the farm. Last three weeks, I am waiting for an appointment. I am making a last try to talk to my bankers whom I have trusted. Or else, I have to accept great shame and decline to supply to prestigious clients and let my competition take away my hard earned goodwill and effort and accept my loss meekly. I have another property in Mumbai valued by your bank worth 37 lakhs and registration process of documents for that property need to be complied with and will be ready in 2 months and I wish to bring that co lateral to you to start a buffalo dairy and piggery project. But all of that seems to be dissolving into a mist of fantasy. What is the point if even on delivering , performing, offering co lateral security, complying norms, I cannot have even the good grace of knowing if I am ever going to get financial support? For gentle solace and philosophical advocacy of the virtues of patience , I go to my Guru, for money I come to the bank. Yours truly, Mandar Tambe Parshurama, Partner
Posted on: Tue, 29 Oct 2013 20:56:51 +0000
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