MAHINDRA & MAHINDRA LTD. | Integrated Annual Report 2021-22

MAHINDRA & MAHINDRA LIMITED 25 Sr. No. Particulars Disclosures 2. Type/Nature, material terms and particulars of the contract or arrangements 1) Avail inventory financing solutions for dealers of MUSA through payment of wholesale interest cost to MFUSA 2) A vail financing solution for end customers of MUSA by payment of retail interest costs to MFUSA 3) MUSA transfers its receivables to MFUSA and receives financing upfront from MFUSA 4) Payment of any other interest cost, charges & reimbursement of expenses 5) Sharing of retail credit risk through a loss pool arrangement 3. Any advance paid or received for the contract or arrangement, if any Based on the nature of transaction, advance for part or full amount of the transaction / arrangement could be paid / received in the ordinary course of business. 4. Tenure Contracts / arrangements / agreements / transactions for a period of 5 years i.e. upto 31 st March, 2027. 5. Justification for why the proposed transaction is in the interest of the Company MFUSA is a Joint-Venture Company between DLL, a global financial solutions provider and fully owned subsidiary of the Rabobank Group, and Mahindra and Mahindra Financial Services Limited (MMFSL). MFUSA provides complete financing solution for MUSA’s dealers and end customers. Dealers avail inventory financing (floorplan financing) from MFUSA. Further, MFUSA also provides end customers with competitive and effective financing options to meet their needs. DLL and MMFSL bring more than 60 years of combined experience in financial services and equipment lending. The mutually rewarding relationship has allowed both the companies to finance key agriculture-based projects and equipment and scale new vistas of financial services, positively impacting the communities at large. Together they bring experience, value, and exceptional service to the customers with strong focus on product offerings and technology. The collaboration will continue to accelerate the company’s position in attractive and growing market. These transactions not only help flow of credit to dealers and end customer, but also ensure consistent flow of funding without interruptions to MUSA. 6. If the transaction relates to any loans, inter-corporate deposits, advances or investments made or given by the listed entity or its subsidiary: Not Applicable as the transactions do not involve any loans, inter-corporate deposits, advances or investments made or given. i) details of the source of funds in connection with the proposed transaction; Not Applicable ii) where any financial indebtedness is incurred to make or give loans, inter- corporate deposits, advances or investments, • natureof indebtedness; • cost of funds; and • tenure Not Applicable iii) Applicable terms, including covenants, tenure, interest rate and repayment schedule, whether secured or unsecured; if secured, the nature of security Not Applicable iv) The purpose for which the funds will be utilised by the ultimate beneficiary of such funds pursuant to the related party transaction Not Applicable