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Cost Vetting: Pay What’s Fair, Fund What’s Real
In project finance, the difference between approval and rejection often comes down to one question: Is the cost genuine?
Over-invoiced machinery has quietly become one of the biggest reasons for loan delays, compliance queries, and even outright rejections. A single inflated quote can derail months of planning, strain promoter-bank relationships, and put the entire project timeline at risk. When capital expenditure runs into crores, banks cannot afford to take prices at face value. Neither can you.
That is where independent cost vetting comes in. It gives banks, investors, and promoters the one thing they need most before the cheque is signed: clarity.
Why Cost Vetting Matters Now More Than Ever
The lending landscape has changed. RBI guidelines, internal bank audits, and rising NPAs have made due diligence stricter. For any term loan or project loan above a certain threshold, banks are mandated to verify the end-use of funds. Machinery is usually the largest single line item in a CAPEX proposal. If that number looks questionable, the entire proposal stalls.
Promoters sometimes discover this too late. They finalize a vendor, submit the proforma invoice, and then face weeks of back-and-forth as the bank’s technical team raises queries. “Why is this press ₹1.8 Cr when a similar spec was ₹1.3 Cr last quarter?” “Can you provide two more comparable quotes?” “Is this vendor related to the promoter company?” Each query adds time, and in projects, time is money.
Cost vetting solves this at the source. Instead of reacting to bank objections, you proactively submit a certified, third-party report that answers those questions before they are asked.
What Our Cost Vetting Actually Does
- 1. Market Benchmarking: We compare your machinery quote against live market data, recent transactions, and industry price indices. If you are buying a CNC machine, we check what similar capacity machines from reputed OEMs are selling for right now, not two years ago.
- 2. Technical Specification Review: Price means nothing without context. A ₹2 Cr injection molding machine could be reasonable or outrageous depending on tonnage, automation level, and make. Our Chartered Engineers match the technical brochure against your quote line by line. We ensure you are paying for what you are actually getting.
- 3. Vendor Due Diligence: We check vendor credentials, manufacturing capacity, and market reputation. Buying from an unknown trader vs a direct OEM changes the risk profile. Banks know this. So do we.
- 4. Cost Break-Up Validation: Lump sum figures hide problems. We split the quote into base price, taxes, freight, installation, commissioning, and training. This transparency is exactly what bank appraisal teams look for.
- 5. Reasonableness Certification: After the checks, our Chartered Engineer issues a formal certificate stating that the cost is fair and reasonable for the declared specifications. This document is bank-ready and accepted by most PSU banks, private banks, and NBFCs.
The Result: Speed, Trust, and Savings
The impact of cost vetting is immediate and measurable.
- For Banks: You reduce exposure to over-invoicing and fund diversion risk. The credit file is cleaner, audit queries drop, and disbursement timelines shrink. Your technical team spends less time chasing documents and more time evaluating real project risk.
- For Promoters: You avoid the nightmare of last-minute loan restructuring. With a vetted cost certificate, your proposal moves faster through credit committees. You also gain negotiating leverage with vendors because you know the real market price. Many clients discover they were about to overpay by 12–18% before we intervened.
- For Investors: Whether it is PE funding or internal CAPEX approval, you get independent assurance that capital is being deployed efficiently. Every rupee goes into the asset — not thin air.
When Should You Get Cost Vetting Done?
The impact of cost vetting is immediate and measurable.
The best time is before you submit your loan proposal. But it is never too late. We routinely handle cases where the bank has already raised a query and the promoter needs a quick, credible response. Typical turnaround is 3–7 working days depending on machine complexity and site visit requirements.
This service is critical if you are:
- Applying for a term loan for new machinery
- Undertaking expansion, modernization, or diversification
- Buying imported or customized equipment
- Purchasing second-hand machinery where valuation is subjective
- Dealing with a bank that has mandated LIE or TEV reports
Our Commitment
We are not here to kill your deal. We are here to make it bankable. Our team combines Chartered Engineers, procurement specialists, and finance professionals who speak the language of both shop floors and credit committees. We have vetted machinery ranging from ₹25 lakh packaging lines to ₹80 Cr process plants across textiles, plastics, pharma, food processing, and engineering sectors.
The goal is simple: remove doubt from the cost line so the bank can focus on your business potential.
In today’s funding environment, the cheapest quote is not always the best, and the highest quote is rarely accepted. The right quote — the one that is verified, reasonable, and documented — is the one that gets funded.
Stop guessing. Start vetting.
Verify Costs Before You Invest
Ensure every project cost is justified, transparent, and funding-ready with MIRA's independent Cost Vetting Services.
Pay What's Fair. Fund What's Real.