Oct. 15, 2009
-- New Delhi (14/10/2009)
SAS Motors and Punjab National Bank have today signed a memorandum of understanding to provide consumer finance of the Angad 240D - SAS Motor’s 22 HP tractor that pioneered the introduction of low cost tractors in the Indian agricultural sector.
In a path-breaking arrangement, this agreement provides finance to farmers who purchase the Angad 240D from SAS Motor’s company owned outlets located in Gorakhpur and Varanasi.
This move is designed to re-structure the traditional distribution channel for tractor retailing and promotes a direct link between the farmer and the company. Small farmers can look forward to fair pricing, transparent dealings, optimum after-sales service as well as comprehensive consultancy from company representatives on optimum usage of the tractor as well as entrepreneurial possibilities on generating additional income streams by owning the tractor.
Says Ravindra Kumar, CEO, SAS Motors, “we look upon this MoU and the introduction of our company owned outlets as the first step in establishing a cost-effective and transparent a new distribution system free from corruption and ambiguity.”
The memorandum of association also extends its scope beyond the traditional method of tractor financing. In order to mitigate the concerns over high NPA’s on tractor loans, SAS Motors has agreed to partner with Punjab National Bank in the evaluation of farmer applicants and loan recovery to ensure that the process is entirely transparent and the most deserving candidates have access to appropriate finance.
SAS Motors has gone a step further to guarantee payments of the loans by depositing 5% of the sales proceeds with Punjab National Bank. In case of non-payment, SAS Motors has agreed to buy the re-possessed tractors at the outstanding amounts.
Adds Ravindra Kumar, CEO, SAS Motors, “We envisage that this new initiative will revive tractor financing in India and is a significant step towards realizing our goal of making low cost mechanization accessible to small farmers.”