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Andhra Pradesh State Financial Corporation is the Premier Term Lending Institution in the State which provides adequate and timely financial assistance to its customers and ultimately contributing for the industrial promotion in the State. In addition to the customer satisfaction, the prime object of the Corporation, it is also the endeavor of the Corporation to give quick service to the entrepreneurs. The Corporation sanctions loans on the security of primary as well as collateral security. After receipt of the sanction letter, the entrepreneur has to complete the legal formalities securing the loan sanctioned as stipulated in the Sanction letter. After completion of legal formalities, funds will be released as per eligibility. Procurement of papers pertaining to the properties being offered by the borrowers in favour of the Corporation will take considerable time
A brochure containing the check list as to the various papers required for completion of legal formalities for securing the loan sanctioned by the Corporation is brought for the convenience of the entrepreneurs.




Legal Sanction Disbursement




A unit can be started in any one of the following constitutions i.e. (1) Sole Proprietary Concern, (2) Partnership Firm, (3) Private Limited/Limited Companies, (4) Societies.



1. In case of Sole Proprietory Concern

Bio-data of the proprietor by way of copies of PAN Card/ Passport/ Voters identity card/ Bio-data with photo and signature attestation by Gazetted Officer/Bank Manager.


2. In case of Partnership Firm

a. Copy of Partnership Deed

b. Copy of Firm Registration Certificate

c. Extract of Form-A from Registrar of Firms (for old firms and in case of additional loans) regarding existing partners as on date.

d. Bio-data of partners by way of copies of PAN card/passport/voters identity card/bio data with pass port photograph and signature duly attested by Bank Manager/Gazetted Officer.

3. In case of Companies

a. Memorandum & Articles of Association.

b. Bio-data of Promoter Directors affixing colour photo and duly attested by Bank Manager/Gazetted Officer/Copies of PAN Card/Copies of Passport./voters identity card.

c. Resolution of Board of Directors of the company authorising two directors to raise loans from APSFC and sign necessary loan security documents and affix common seal thereof.

d. Copy of certificate of incorporation if it is a Private Limited Co.

e. Copy of Certificate of Incorporation and Commencement of Business in the case of Limited companies.

f. Copy of General Body Resolution u/s.293 (i) (d) of Companies Act in case of Limited Companies, permitting the company to borrow in excess of paid-up capital and free reserves and Resolution u/s.293 (1) (a) of Companies Act for mortgaging the fixed assets of the company in favour of the Corporation.

g. Consent letters from the Directors about furnishing of their personal guarantee with copies of property documents.

h. Search Report from CA/Extract of register of charge from ROC in case of existing companies and companies seeking additional loans.

4. In case of Societies

a. Registration Certificate of the Co-operative Society.

b. Bye-laws of the Society, duly certified to be true and upto date.

c. List showing the names and addresses of the members of the Governing body/Executive Committee of the Co-operative society along with Biodatas by way of copies of PAN Card/ Passport/ Voters Identity Card/ Biodata with Photograph, duly attested by any Bank Manager/Gazetted Officer.

d. Certified copy of the resolution of the co-operative society that it is authorized to raise loan on the mortgage of the properties in favour of the Corporation as per the Bye-laws of the Society, duly authenticated by the signature of the Chairman of the meeting in which, the resolution was passed.

e. Certified copy of the resolution authorizing the Governing body / Executive Committee to raise loan from the Corporation and to execute the necessary loan security documents to the Corporation for completion of legal formalities.

f. Necessary permission from the Registrar of the Co-operative Societies for raising the loan from the Corporation.


The primary security can be either leasehold interest or freehold interest . If the unit is going to be started in a leasehold premises, it is called leasehold and if the unit is going to be started in own premises, it is called freehold.


In case unit is coming up in a leasehold premises, the Corporation will insist for equitable mortgage of leasehold interest. If there is no loan on civil works, the lease period shall be repayment period plus two years. If loan is provided on the civil works then lease shall be for a period of 30 years. Please note that lease for any period is compulsorily registerable affixing required stamp duty. Then the documents that are required are as under:

a. Registered Lease Deed in the standard format given by APSFC for the period prescribed in the sanction letter i.e. loan period plus two years if no loan is provided on civil works and if loan is sanctioned on civil works, 30 years lease deed is required.

b. Copy of lessor title deed in proof of ownership and in the absence of title deed, revenue records or ownership certificate issued by local Government or property tax receipts.

For creation of equitable mortgage in case of freehold interest in land and buildings.

If vacant land is acquired and buidings are to be constructed:

a. Original Regd. title deed in the name of the Proprietor/ Firm / Company along with certified copy having clear approach road.

b. Pattadar Pass Book/title deed issued by MRO/RDO in the name of the proprietor/firm/company/society.

c. Original/Copies of link documents (Vendor’s title deed) pertaining to the property under the scheme along with copies of Pass Book and Title Deed reflecting the sale entry. If pass book and title deeds are not issued, a certificate from MRO to that effect is required.

d. Extracts of revenue records i.e. Khasra Pahani for 1954-55 along with Pahanies in Telangana Area and 10 (1) along with Adangals in Andhra Area for the last 13 years.

e. No PT Certificate in case of Telangana Area.

f. E.C for 13 years (or) from the date of document if title deed is of beyond 13 years to the date of deposit disclosing all transactions.

g. ULC permission u/s.26/exemption under ULC Act as the case may be in case the land is within urban agglomeration.

h. Permission from Urban Development Authority/ Building Plans if the site is within the Master Plan of Urban Development Authority.

i. Affidavit by promoters to the effect that there are no court cases pending against the property under the scheme.

If the unit is coming up in APIIC land:
a. Original Regd. Sale Deed.
b. Original Regd. Sale Agreement.
c. Possession handing over letter and Allotment letter.
d. No dues Certificate and NOC to mortgage the lands allotted with the Corporation.


Generally, the Corporation insists for Collateral Security and the percentage of Collateral Security is dependent upon the location and the nature of industry and the nature of loan. Also the Corporation insists for preferably urban immovable property towards Collateral Security and preferably belonging to the borrowers. The Collateral Security can be either in the form of vacant land, house, apartment, fixed deposits, Bank Guarantee.

If it is vacant land:

a. Original Regd. title deed in the name of the surety along with certified copies.

b. Original link documents (Vendor’s title deed).
c. Extracts of revenue records i.e. Khasra Pahani for the year 1954-55 along with Pahanies in Telangana Area and 10 (1) along with Adangals in Andhra Area for the last 13 years.

d. No PT Certificate in case of Telangana Area.

e. E.C for 13 years from the date of document and in case title deed is beyond 13 years from the date of document to the date of deposit disclosing all transactions.

f. ULC permission u/s.26/exemption under ULC Act as the case may be in case the land is within urban agglomeration.

g. Copy of the Approved Layout/Sketch drawn by Mandal Surveyor demarcating the site/plot with Sy.No and boundaries and a land mark for identification.

If it is house:

a. Original Regd.Conveyance Deed along with certified copy.
b. All the relevant Link Documents.
c. EC for 13 years (or) from the date of document in case title deed is beyond 13 years to the date of deposit disclosing all transactions.

d. Tax Demand & Receipt/Ownership Certificate/ Extract of property tax demand register for the last 13 years.

e. Approved building plans from Competent Authority.

If it is an Apartment:

a. Original Registered Sale deed in the name of the surety.

b. Copy of the development agreement and link documents.

c. Copy of the approved building plan.

d. Encumbrance Certificate for the last 13 years.

e. It shall be established that the original title deeds of the project are not mortgaged to bank or any financial institution availing project finance, by way of declaration from Builder/Landlord.

f. Mutation in favour of the surety.

g. Tax Demand and Receipt / Ownership certificate/ EPPDR.

If it is FDR:

a. The beneficiary/payee of fixed deposit should give a consent letter for pledging the fixed deposit with the Corporation as Collateral Security in consideration of sanction of loan to the unit to which the security is being offered.

b. The beneficiary/payee of the fixed deposit should also assign the proceeds of fixed deposit in favour of the Corporation by a proper endorsement by the concerned bank.

c. A discharge voucher from the beneficiary/payee of fixed deposit duly affixing necessary revenue stamp (without mentioning the date) on the backside of the FDR.

d. A letter addressed to bank by the beneficiary/payee authorising banker to pay the proceeds to the APSFC as and when the fixed deposit is presented by the APSFC.

If it is Bank Guarantee:

The collateral security can be offered by the borrower by way of Bank guarantee also in such a case the following documents shall be submitted:

1 Bank guarantee executed by the concerned Bank on required stamp paper by the authorized signatories of the Bank affixing their rubber stamp containing the serial number of the signatory as per the Bank rules.

2 A confirmation copy shall be forwarded by the Bank Manager to the Corporation in a sealed cover by post.

3 A letter from the Bank that they will pay the amount in case the Bank guarantee is invoked in time.

4 If the amount guaranteed is Rs.1.00 lakh and above, the Guarantee Agreement shall be signed by 2 Authorised Officers of the Bank.


a. If the borrower is proposing to purchase the property standing in the name of minor, permission from the Court shall be obtained.
b. For purchase of land, which is an Inam land, occupancy certificate/Form-B patta from competent authority shall be obtained.

c. Assigned lands should not be purchased without prior written permission of RDO.

d. For purchase of joint family property, the borrower should ensure that all the co-parceners of the vendor family join in the execution of the sale deed.

e. For purchase of lands covered under Master Plan of the respective Urban Development Authority, the borrower shall ensure that the proposed land is falling within the Industrial Zone.

f. If the borrowers are seeking loans on land & buildings, the borrower shall purchase the lands in the name of proprietor/firm/company/ society as the case may be.

g. Generally, the Corporation will not accept third party collateral security.

The following are the loan security documents to be executed by the borrowers in favour of the Corporation and the required documents for a particular loan are to be taken from amongst the documents mentioned below:

1. Deed of Hypothecation
2. Memorandum of Deposit of Title Deeds
3. Guarantee Agreement
4. Loan Agreement
5. Promissory Note
6. Assignment of Development Rights

The applicable documents from out of the above shall be executed by the borrowers in favour of the Corporation.

The borrower shall pay the necessary stamp duty that is to be payable and applicable in the State of Andhra Pradesh on the security documents.

The above list is not exhaustive and after scrutiny of the documents that are submitted, if some more documents are required for establishing a valid marketable title for the properties being offered as security for the loan sanctioned by the Corporation, the entrepreneurs have to submit the same. For any clarifications, you may contact the Legal Officer in the Branch or Legal Department in the Head Office.



  • Brief project report
  • Copy of ssi registration certificate
  • Bio-data of proprietor / partners / directors with 2 pasport size colour photographs as per proforma alongwith copies of certificates regarding academic qualifications, experience etc.
  • Solvency declaration of proprietor / partners / directors as per proforma (on rs.20 non-judicial stamp paper)
  • C0py of partnership deed & firm registration in respect of firms/memorandum and articles of association & certificate of incorporation in respect of companies.
  • Copy of land sale deed/ sale agreement / allotment letter of apiic ltd.
  • Building plans (approved plans in respect of hotels/nursing homes/commercial & residential complexes proposals)
  • Civil estimates
  • Letter from the lessor expressing willingness to let out the building and execution of regd. Lease agreement for 7 years in the unit is proposed in leasehold buildings with rough plan.
  • Quotations for machinery and equipment from standard suppliers alongwith comparartive quotations.
  • Copy of panchayat / municipal approval.
  • Copy of power feasibility letter from a.p.transco.
  • Copies of collateral security property documents.
  • Working results (audited balance shdeets and profit & loss accounts) for the last 3 years in respect of existing units and the provisional for the current year with all schedules.
  • Working results (audited balance shdeets and profit & loss accounts) for the last 3 years of associated concerns of promoters.
  • Particulars of available assets (land, buildings, machinery) in respect of existing unit.
  • Other details such as raw material & market tie-ups, technology tie-up with background of technical consultant etc.
  • Other details such as raw materials and slaes invoices, list of major customers, particulars of orders on hand etc.
  • Service charge @ 0.5% of loan applied + 12.36% service tax on the service charges at the time of filing the application.
  • Upfront fee @ 0.5% of the loan sanctioned + 12.36% service tax on upfront fee at the time of first disbursement.




Before disbursement of loan, the loanee is required to :

  • Obtain legal formalities completion(LFC) certificate by completing hypothecation  of title both in respect of primary and collateral security from legal section.
  • Comply with the various terms & conditions and specific stipulations of sanction and to raise the required capital / long terms loans and create fixed assets to the extent stipulated for Initial capital.
  1. The Corporation generally reimburses the amount incurred on creation of fixed assets i.e. land, building & machinery
  2. Release against building is made in stages depending upon the progress of building as per approved scheme. 
  3. For release against plant & machinery the loanee is required to submit original invoices, payment receipts, bank statement confirming realisation of cheques, performance guarantee  
  4. Alternatively, direct payment can be released by the Corporation to the machinery supplier on the basis of proforma invoice if the supplier is registered with the Corporation or is a standard supplier after the entrepreneur has deposited the required margin money with the supplier/Corporation and produces confirmatory letter that the machinery is ready for delivery.  
  5. If the supplier is not registered with the corporation or is not a standard / reputed supplier commitment letter will be issued to the supplier and on delivery of the machinery payment will be made to the supplier. If the supplier so opts he can negotiate the documents through any commercial bank and get the payment released by dispatching the machinery through a reputed transport agency.
  6. The Corporation   issues letter of commitment in favour of the bankers of the borrowers in cases where L.C. is to be opened by the commercial banks. On presentation of certified set of documents, the Corporation releases the permissible amount to the bank for discharge of documents after fulfilling the terms and conditions stipulated in the commitment letter issued by the Corporation.  
  7. Release up to 50% against material bills in case of self – fabricated machinery is made.  After completion of erection the balance eligible amount will be released retaining 10%/15% of eligible amount for satisfactory performance.



Loan Application Forms can be downloaded from "Products & Services" Tab. The cost of Application, Rs.500/- will be collected at the time of submission of Application.

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