Mahindra Tractors and Punjab National Bank (PNB) have partnered to offer enhanced financial solutions to Mahindra tractor dealers. This agreement provides dealers access to tailored financing options to improve working capital management, streamline inventory processes, and foster business expansion. The program offers finance limits up to INR 5 crore, with flexible repayment terms and competitive interest rates.
Mahindra Tractors dealers with at least one year of business history can access this channel financing. The program provides a finance limit based on 105 days of sales, up to INR 5 crore. Dealers receive a 105-day credit period with a 15-day grace period and 100% funding of Mahindra & Mahindra invoices without margin requirements.
PNB’s digital Financial Supply Chain Management
The financing offers competitive interest rates and simplified documentation. PNB’s digital Financial Supply Chain Management (FSCM) module will facilitate the process. The program also addresses peak season financial needs.
“We are delighted to partner with Punjab National Bank to offer our dealers a comprehensive financial solution that addresses their unique business needs. We are committed to supporting our dealer network by providing them with the tools they need to thrive. This collaboration with PNB will help improve working capital management and drive efficiency, ultimately enabling our dealers to better serve the farming community,” said Hemant Sikka, President – Farm Equipment Sector, Mahindra & Mahindra Ltd.
Providing tractor dealers with financial resources
This partnership aims to equip Mahindra tractor dealers with the financial resources needed to succeed. The program’s flexible nature allows dealers to efficiently manage financial demands during peak seasons, improving operational efficiency. The collaboration with PNB allows Mahindra to further support its dealer network.
This agreement facilitates improved working capital management for dealers. It also streamlines inventory control processes, ensuring optimal stock levels and minimising storage costs. The financing aims to drive business growth by providing dealers with the capital necessary to expand operations and invest in new opportunities.
“We are excited to partner with Mahindra & Mahindra-Farm Division to launch this innovative Dealer Finance Program. This initiative underscores our commitment in supporting the growth of businesses across sectors, specially MSME and Agriculture by providing them with customised financial solutions. We believe this program will play a crucial role in enhancing the operational efficiency and financial needs of Mahindra & Mahindra-Farm Division’s dealer network. This collaboration will provide tailored financial solutions to dealers, enabling them to enhance their working capital, streamline inventory management, and optimise cash flow. The program is designed to offer flexible credit options, competitive interest rates, and simplified documentation processes, empowering dealers to focus on business growth and customer satisfaction,” said Firoz Hasnain, Chief General Manager and Zonal Head, Mumbai Zone, Punjab National Bank, offered this perspective.
Strengthening existing relationship
Many Mahindra dealers already have existing relationships with PNB. These relationships include various financial products like CC limits, bank guarantees, and current accounts. This existing connection will ensure a smooth transition for dealers choosing to move their channel financing to PNB.
Dealers currently using channel financing from other institutions can also transfer their arrangements to PNB through a balance takeover. This option provides flexibility for dealers to consolidate their financial services with PNB. The program’s flexible structure addresses the varying financial needs of dealers throughout the year.
The focus on improved working capital management is critical for dealers. This aspect helps them maintain healthy cash flow and cover operational expenses efficiently. The streamlining of inventory management helps dealers avoid overstocking or shortages, optimising their inventory investment.
The initiative aims to provide dealers with a comprehensive suite of financial services. This includes the necessary resources to support their operations and growth. The agreement represents a commitment by both Mahindra Tractors and PNB to support the agricultural sector.
The simplified documentation process reduces administrative burden for dealers. This streamlined process allows them to focus on business operations rather than paperwork. The collaboration leverages the strengths of both Mahindra Tractors and PNB. Mahindra Tractors benefits from a strengthened dealer network, while PNB expands its reach within the agricultural sector.
