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Request for Proposal for Review and Revision of Internal

Request for Proposal for Review and Revision of Internal Credit Rating Model (ICRM) for Assessing Micro Finance Institutions and Not-for-profit Community Organizations

Project Finance Department
Head Office, National Housing Bank
Core 5-A, 4th Floor, India Habitat Centre, Lodhi Road
New Delhi – 110003
Phone: 011-24649432
E-Mail : peeyushp@nhb.org.in
Note : Technical bids will be opened in the presence of bidders who choose to attend as under :
BID DETAILS
1. Last Date and Time for Receipt of Bidding Documents Friday, 11-07-2008 6.00 pm
2. Date and Time of Technical Bid Opening Monday, 14-07-2008 3.00 pm
3. Place of Opening of Bids National Housing Bank, Project Finance Department Head Office Core 5-A, 4th Floor India Habitat Centre, Lodhi Road New Delhi – 110003

INSTRUCTIONS TO BIDDER

National Housing Bank National Housing Bank (NHB), a statutory organisation, is a wholly owned subsidiary of the Reserve Bank of India. NHB is an Apex Financial Institution formed under the Act of the Parliament with a mandate to promote, develop and regulate the Housing Finance Sector. Apart from regulating the housing finance companies (HFC), NHB also extends financial support by way of equity participation in HFCs and refinance facility to financial institutions such as Banks, HFCs, Co-operative Sector Institutions, Housing Agencies, etc. in urban and rural areas. NHB also extends project finance support for housing to different categories of institutions such as housing boards and public agencies, public private partnership companies, Micro Finance Institutions (MFIs), not-for-profit organizations.

Housing Micro Finance (HMF) support to MFIs, not-for-profit organizations is a growing focus area for NHB, given huge housing shortage in the lower income segments in the informal sector. NHB has been extending housing micro finance support for the last four years, and has developed systems and procedures for the same, including an Internal Credit Rating Model for assessing the institutions against their eligibility for such support.

The Head Office of NHB is located in New Delhi with Regional Office in Mumbai and Representative Offices in Hyderabad, Chennai, Bengaluru and Kolkata.

I. Objective

To review and revise the Internal Credit Rating Model (ICRM) of National Housing Bank (NHB) for financing Micro Finance Institutions (MFIs) including not-for-profit community based organizations, Non Governmental Organizations (NGOs) constituted as Registered Societies or Trusts or Section 25 Companies.

II. Scope of Work

(i) To review the existing ICRM for MFIs in the light of the experience gained so far and the developments in the sector relating to MFIs.

(ii) To study, examine and document comparable models being used by other financial institutions in India and abroad.

(iii) To develop ICRM for not-for-profit community based organizations (CBOs) as potential clients of NHB to channelise credit to the lower income groups.

(iv) To develop ICRM for organizations which hitherto were only engaged as originating and servicing agents for institutional lenders but were not lending on their own accord, i.e. organizations which are migrating to lending.

(v) To suggest a suitable appraisal, administrative and monitoring framework for such not-for-profit organizations including standard appraisal formats, application forms duly taking into consideration the special features of community based organizations, the longer tenure of housing loans and the lack of experience on the part of such organizations in managing credit risk over long periods.

III. Methodology

i) Study past experience of NHB

(ii) Study and compare credit rating models for micro finance lending in India and abroad, particularly for housing loans.

(iii) Study the country context and range of MFIs undertaking housing micro finance or having the potential to undertake housing micro finance.

(iv) Identify the relevant parameters / variables with assessment.

(v) Review legal and institutional framework of the community based organizations with reference to their suitability for long term borrowings.

(vi) Study the capacity of the MFIs to undertake long term housing micro finance.

(vii) Validate new ICRM vis-à-vis external ratings, if any.

(viii) Suggest periodicity for review of the ICRM for these institutions in view of rapid changes in the segment.

IV. Deliverables

(i) ICRM for rating of community based organizations, differentiating between not-for-profit community based financial institutions (CBFIs) and for-profit MFIs taking into account various factors like legal constitution, size, regional characteristics, business strategies, operating methodologies, customer profiles, financial strength, risk management capabilities, business models, etc.

(ii) Standard appraisal framework, format for appraising CBFIs and application forms, periodic reporting formats to be submitted by CBFIs, and suitable MIS framework in the Bank, preferably compatible with SAP.

V. Eligibility Criteria for Bidders

(i) Public limited company

(ii) Minimum 5 years’ experience in credit rating in India and / or abroad particularly in the rating of Micro Finance Institutions. Weightage will be given to bidders having experience in rating Housing Micro Finance institutions and not-for-profit organizations.

VI. Bidding Process (2 Stages)

For the purpose of the present assignment, a two-stage bidding process will be followed. The response to the RFP will be submitted in two parts :

  • Technical bid Part I
  • Financial / Commercial bid Part II

The bidder will have to submit the Technical bid and Commercial portion of the bid separately in two separate red lac-sealed envelopes (wax seal), duly superscribing “Review and Revision of Internal Credit Rating Model (ICRM) for Assessing Micro Finance Institutions and Not-for-Profit Community Organizations “, “Technical Bid” or “Financial / Commercial Bid” as the case may be.

Technical Bid shall not contain any pricing or commercial information.

The bid shall be typed or written in indelible ink and shall be signed by the Bidder or a person duly authorized by him. The authorization shall be indicated by a written power of attorney accompanying the Bid. All pages of the Bid shall be initialed by the person(s) signing the Bid.

The Bid shall contain no interlineations, erasures or overwriting except as necessary to correct errors made by the Bidder, in which case corrections shall be initialed by the person(s) signing the Bid.

VII. Bid Document for Technical Bid

The Bid Document for Technical Bid shall contain the following details :

(i) Experience in developing Credit Rating Models for Financial institutions, MFIs and housing micro finance entities.

(ii) Experience in credit rating in micro finance and housing microfinance (at least three summary rating documents to be submitted) with contact details of clients

(iii) Experience in designing of financial products and operating framework for financial products with contact details of clients

(iv) Experience in providing consultancy services for the micro finance and housing micro finance sectors with contact details of clients

(v) Composition of Board of Directors and details of key personnel including their qualifications, experience etc.

(vi) Proposed work

  1. Methodology to be adopted
  2. Time to be taken
  3. Composition of team for the proposed work including the qualifications, experience, track record of the team members

VIII. Bid Document for Financial / Commercial Bid

The Bid Document for Financial / Commercial Bid shall contain the amount bid for the proposed work including the break up for different components and the payment schedule. All the amounts shall be mentioned only in Indian Rupees.

IX. Evaluation of Technical Bids

Criteria and Point System for the evaluation of the Technical Bids are as under :

Maximum Marks
1. Experience in credit rating in micro finance 10
2. Experience in credit rating in housing micro finance 10
3. Experience in designing of financial products and operating framework for financial products 10
4. Experience in providing consultancy services for micro finance 05
5. Experience in providing consultancy services for housing micro finance 05
6. Composition of team for the proposed work, their qualifications, experience, track record 15
7. Methodology of proposed work 10
8. Time to be taken 10
75

Rating references may be provided in respect of sr. nos. 1 – 5 above.

The minimum qualification score for the Technical Bid will be 45.

X. Evaluation of Financial / Commercial Bids

The Financial / Commercial Bids of only those bidders who achieve the minimum qualification score in the Technicial Bid will be opened.

The bid amount should be inclusive of all taxes and applicable Government levies.

The Financial / Commercial Bid will carry maximum score of 25. Bids will, therefore be evaluated on maximum score of 100.

XI. Submission of Bids

The bidders shall duly seal each envelope and place both the envelopes in a third envelope, which shall also be sealed. The outer envelope shall be superscribed in bold letters “Bid for Review and Revision of ICRM”.

The Bid shall be sent / delivered to the Bank at the following address :

General Manager (Project Finance)
National Housing Bank
Head Office Core 5-A, 4th Floor, India Habitat Centre, Lodhi Road
New Delhi – 110003

XII. Last Date and time for Submission of Bids

Bids must be received by the Bank at the address specified in Clause XI of this document not later than the specified date and time as mentioned on page 2 of this document. In the event of the specified date of submission of bids being declared a holiday for the Bank, the bids will be received up to the appointed time on next working day.

XIII. Late Bids

Any bid received by the Bank after the deadline for submission of bids will be rejected and / or returned unopened to the Bidder, if so desired by him / her.

XIV. Modifications to and / or Withdrawl of Bids

  • Bids once submitted will be treated as final and no further correspondence will be entertained on the subject.
  • No bid will be modified after the deadline for submission of bids.
  • No bidder shall be allowed to withdraw the bid, if the bidder happens to be a successful bidder.

XV. Cost of Bidding

The bidder shall bear all the costs associated with the preparation and submission of bid and Bank will in no case be responsible or liable for these costs regardless of the conduct or outcome of the bidding process.

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EMPANELMENT OF PRINTERS & DESIGNERS

General Terms and Conditions applicable to the Printers & Designers

1. The National Housing Bank intends to make a panel of printers and designers for getting designing and printing jobs. The panel would be valid for a period of two years in the first instance, which may be extended with mutual consent.

2. Reputed printers & designers experienced in conceptualizing, designing, printing of documents etc. who have sound back–up for excellent designing, scanning, planning etc. of publication of various descriptions /literature for black & white and multi color jobs needs to apply. The printing and designing jobs broadly includes designing and printing of brochures, reports, posters, pamphlets, letter heads, envelopes, visiting cards, greeting cards, files, folders, bags, publicity material etc. on the basis of modern facilities standards available the industry.

3. The printer should be in profession of printing for the last 3 financial years.

4. Annual Turnover should be up to Rs. 3.00 crores in the last three financial years.

5. The printer and designer should be on the approved panel of at least 3 Public Sector Banks or Public Sector Undertakings or Govt. organization.

6. The printer should have at least one single color & one 4- Color offset machine, in-house stitching & Binding unit & Screen-printing unit.

7. The printer should have registration with state & local authorities for Undertaking the profession (Copies of all such registrations may be enclosed).

8. The rights to postpone / cancel / suspend / terminate the tenders or its process at any stage are reserved by the NHB.

9. Proposals of the interested firms can also be rejected at the sole discretion of the NHB, if any application found incomplete or information provided by the printer & designer is not in the prescribed format and is inconsistent and inaccurate.

10. The NHB reserves the right to keep or remove any firm on the approved panel for designing and printing jobs etc. for any administrative reason.

11. The firm should have full fledged unit of their own for visual design facility, preparation of art work, translation in English, Hindi, Urdu etc., proof reading, designing, composing, printing etc.

12. The firms for contracts will not be entertained if having any dispute with NHB till settlement of the dispute.

13. A schedule for the work and for the delivery of printed copies will be drawn by the NHB and will be intimated to the printer & designer while placing the order for the job. The printer & designer should only accept the job if it is in a position to complete the job according to the schedule.

14. In the event of the delivery of any defective works / materials, owing to urgency or for any other reasons, NHB shall have the power to deduct such suitable sum from any payment due to the printer & designer or security deposit amount, as may be deemed fit by the NHB.

15. Notice of the printing job can also be sent to the empanelled printers & designers through fax/mail/e-mail/voice telephone/by-hand in addition to speed post / registered post / courier etc.

16. The printers & designers applying for empanelment should furnish all the particulars as per Appendix – A.

17. The date of declaration of qualified/empanelled printers & designers will be declared at the discretion of NHB which could be intimated through any means of communication as mentioned above.

18. In case, the successful party refuses to undertake offered printing jobs / shows its inability to discharge the obligation in the contract, NHB reserves the right to forfeit Security Deposit in full & de-listed from panel of NHB.

19. All the items to be received from the Printer and Designer would be checked by the officer-in-charge to ensure that the ordered jobs confirmed to the approved specifications/ quality as per samples approved by the NHB.

20. Payment will be released on presentation of correct bill supported with the copy of the work order of the authorized officers of the NHB and upon such certification to the effect that the jobs got printed from the Printers are as per approved specifications.

21. Additional / modified / revised terms & conditions can also be made applicable to the empanelled printers and designers including those who are being awarded any job / work by the NHB at any stage as per requirements of the NHB, if felt necessary.

22. The applications have to be submitted to Deputy General Manager, DRMD, National Housing Bank, Core 5A, 5th floor, India Habitat Centre, Lodhi Road, New Delhi – 110 003.

23. The last date of submission of the documents is 21/07/2008. The agencies have to submit the earnest money of Rs. 50,000/- (Rupees fifty thousand only) (Refundable) in the form of demand draft payable at New Delhi while submitting their proposal. In case the designated day is Saturday/Sunday or is declared as a public holiday, the same may be extended to next working day. The offers must be submitted in covers duly sealed (Red Lakh Seal), failing which the documents would not be accepted. National Housing Bank reserves the right to reject any application without assigning any reason.

24. No proposal will be entertained / received after the prescribed due date.

25. In case of the dispute, the decision of the CMD, NHB would be final and binding.

Appendix – A

Particulars to be furnished by the Printers & designers applying for Empanelment in NHB

1. Whether firm is a printer or designer or both :

2. Name & Postal address of printer & designer and his firm :

(i) Telephones Nos. :
(ii) E-mail / Website :
(iii) Fax Nos. :
(iv) Mobile Nos. :

3. Nature of ownership of firm (Sole/Partnership/otherwise)

4. If Registered, Regn. No. with name of authority :

5. Validity of registration :

6. Sales Tax Regn. No. :

7. Service Tax No. :

8. PAN No. :

9. Description of in-house facilities of the firms :

i) Computers
ii) Processing equipments – Scanner/ Image set-up
iii) Plate making : 2 :
iv) Offset Machine – Four colours
v) Cutting & binding
vi) Any other details

10. Details of printing and designing works executed for the last 3 financial years (indicate year-wise)

11. Details of turn over for the last 3 financial years (indicate year wise)

12. List of clients with telephone Nos. in respect of which works have been executed successfully

13. Details with reasons about disputed cases, if any.

(Signature of the Proprietor/Authorized Signatory)

Rubber Seal of the firm

Place:

Date:

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