Project Report and CMA Charges: What It Costs and Why

There is no official fee scale for a project report or CMA data. The price depends on the loan size, the number of years to be projected, whether the business is new, and how many revisions the bank asks for. At AprilTax, CMA data costs Rs 1,999 and a detailed project report costs Rs 4,999.

What are you paying for?

You are paying for someone to read your papers, build a set of numbers that tally, and present them the way a banker reads them. The typing is the small part. The work is in the regrouping of your accounts, the assumptions behind each projected year, and the checks that make the balance sheet, profit and loss account and cash flow agree with each other.

What drives the price

What is the market rate?

You will hear very different quotes for the same job, and the low and high ends are far apart. We have not found an official or independent survey of these fees, so we are not printing a range here. A quote from a seller's website is not a market rate.

How do you compare two quotes, then? Ask each preparer the same five questions.

1. Is the fee fixed, or a percentage of the loan?
2. How many years of projections are included?
3. Are revisions after the bank's comments included?
4. Will you reply to the bank's queries on the numbers?
5. Will the report be in my bank's format if it has one?

A fee quoted as a percentage of the loan deserves a second look. The work does not double because the loan doubled.

The cost of a weak report: a worked example

Suppose you need Rs 25,00,000 and the bank, unconvinced by the projections, sanctions Rs 18,00,000. You are short by Rs 7,00,000.

You still need the money, so you borrow it elsewhere without security. Assume, only for illustration, that the bank loan costs 11% a year and the other loan costs 18%.

• Extra interest rate: 18% minus 11% = 7%
• Extra interest in a year: 7% of Rs 7,00,000 = Rs 49,000

That is Rs 49,000 in the first year alone, against a report fee of a few thousand rupees. The rates are assumptions and yours will differ. The point holds: the shortfall costs more than the report.

A rejection costs in other ways. You lose weeks, the supplier's quotation may lapse, and you start again at another bank with the same papers.

Does a good report mean the loan will be sanctioned? No. The bank decides on your credit record, security and its own policy. A report cannot change those. What it can do is make sure a sound proposal is not turned down for unclear numbers.

The mistake people usually make

The usual mistake is to buy on price alone and take a template with your name filled in. Such a report shows sales rising by the same percentage every year and ratios that look perfect. Bankers recognise it at once, and they then doubt the genuine figures too.

The opposite mistake is to pay for more than you need. A simple renewal of a cash credit limit needs CMA data, not a long project report. See CMA data vs project report before you order.

When can you do it yourself?

For a very small loan, the bank's application form and a one-page statement may be all the branch wants. Ask first. You can also prepare CMA data yourself if your books are clean and you are at ease with spreadsheets. Pay someone when the loan is for a new project, when a term loan and a working capital limit come together, or when your time is better spent running the business. To see what you will be asked for, read documents for a CMA report and project report.

Frequently asked questions

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