| Canara Bank renders advisory service to the clients in the matter of working capital finance. It includes the following services:
(i) Estimation of working capital requirements.
(ii) Assistance in preparing the application for credit facilities for submission to the bankers and Reserve Bank of India.
(iii) Assistance in negotiations for sanction of appropriate credit facilities.
(iv) Helps in expediting documentation and other formalities for disbursements.
(v) Advises the client for issue of debentures for meeting the increased long term working capital requirements of the client company.
Central Bank of India (CBI) helps the client companies in the calculation and provisions of working capital needed for a given project, management of non-convertible debenture issues, and management of fixed deposit.
Function # 8. Bill Discounting and Acceptance Credit:
In foreign countries, acceptance credit and bill discounting function is another important area which is recognised as a merchant banking activity. But in India this facility is not provided to the corporate units by the merchant bankers.
The need for such services was recognised when Banking Commission 1972, in its report had recommended the establishment of acceptance and discount house in India following the development of bill market.
A bill of exchange accepted by a house of established reputation automatically becomes acceptable to the seller of goods and to the lenders of money even though they do not have any knowledge of the creditworthiness of the drawer of the bill.
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