Impact of Customer Behavior on Credit Score

What is Credit Score?
Credit score is a great indicator of one’s financial health. It signifies the responsible financial and payment behaviour of the customer. It facilitates easier credit access to customers and give them the negotiation ability to have favourable interest rate and other term and condition

What is the Importance of good Credit Score?

• To get better loan terms and easier approval. A good or excellent credit score will save most people significant amount of money
• Individuals with better credit ratings are considered lower-risk borrowers, with more banks competing for their business and offering better rates, fees, and perks.
• Additionally, a poor credit score can affect your ability to find rental housing, rent a car, and other post-paid facilities

What are the key components of Credit Score?

While there can be differences in the information collected and used by different bureaus to calculate Credit Score but given below are some key factors in order of importance in general with some exception possibilites

Payment history Credit Utilization Amounts owed Hard Inquiries Length of credit history Types of credit New credit

How does Credit Utilization Impacts the credit score?

Credit Utilization refers to the portion of your credit limit that you use at any given time. After payment history, it’s the second most important factor in Credit Score calculations.

We should keep our credit utilization in check and try to maintain it between 30% and 50%. Lower the credit utilization better the credit score is. Another way to improve credit utilization is to increase the credit limit by proactive request to your lenders. Request can be made through online or through phone. It is easier to get higher limit by updating your income.

What is the impact of new credit card application on Credit Score?

When a lender requests for your credit report to take decision on your loan application, that is considered as hard inquiry in credit burau. More number of hard inquiries impact the credit score adversely up to 24 months The occasional hard inquiry have lesser impact but many inquiries in very short span of time reflects desperate credit behaviour and decreases the chance of approval of the loan. In specific credit need connect with Credvisors from www.creditinsta.com

How does hard inquiries impact your credit score?

More the number of hard inquires lower the credit score is, So many hard inquiries in short span of time is not good for credit score.

How do I build my credit score if I do not have enough credit history?

If you don’t have enough credit history on your report to generate a credit score. This situation is called Thin File from bureau perspective. There are few alternate credit scores available in the market leveraging banking history, utility payments and rental payment history etc.

Best option to build a good credit score for a Thin File customer is to become authorised user or supplementary card holders on loan or credit card of someone with good credit history.

Estimated time: The older your current accounts are, the better

The age-of-credit portion of your credit score looks at how long you’ve had your credit accounts. The older your average credit age, the more favourably you appear to lenders.

If you have old credit accounts that you’re not using, don’t close them. Though the credit history for those accounts would remain on your credit report, closing credit cards while you have a balance on other cards would lower your available credit and increase your credit utilization ratio. That could knock a few points off your score.

How does consolidation of debt helps to improve Credit Score?

If you have a number of small or big outstanding debts, it may be a good idea to consolidate it in lesser number of debts. Then you’ll just have to keep track and make few payments to deal with, and you may also have opportunity to negotiate on interest rate. You can also pay your debt faster. That can improve your credit utilization ratio and, in turn, your credit score.

A similar idea is to consolidate multiple credit card balances by paying them off with a credit card balance transfer on promotional offers for certain period when they charge 0% interest on your balance. Need to be careful about balance transfer fees

How does Credit Monitoring Services help in managing Credit Score ?

Credit Monitoring Services are an easy way to see how your credit score changes over time. These services—many of which are free—monitor for changes in your credit report, such as a paid-off account or a new account that you’ve opened. Also, they typically give you access to your credit scores which are updated monthly.

Many of the Credit Monitoring Services can also help you prevent identity theft and fraud. For example, if you get an alert that a new credit card account that you don’t remember opening has been reported to your credit file, you can contact the credit card company to report suspected fraud.

Does paying off collections boost my credit score?

Historically, paying off your collections does not improve your credit score because a collection stays on your report for seven years. Newer ways of calculating credit scores no longer count collections against you once they have a zero balance, but it is not possible for you to predict which method your lender will use to calculate your score.

Does paying off a loan help or hurt credit?

Paying off a loan frequently hurts credit because it impacts your credit history and your credit mix. If the loan that you have paid off is your oldest credit line, then the average age of your credit will become newer and your score will drop. If the loan that you pay off is your only loan, then your credit mix suffers.

Will paying the minimum on my cards improve my credit score?

No. This is a widespread myth. You need to pay at least the minimum payment due on your credit card every month so that your cards have an on-time payment history. You do not have to pay a single cent in interest to improve your credit score. In fact, paying your credit card balances in full every month will have the greatest positive impact on your score, because it will improve your credit utilization percentage.

How long does improving your credit score take?

There is no set minimum, maximum, or average number of points by which your credit score improves every month, and there is no set number of points that each action will gain. How long it takes to boost your credit depends on the specifics for why your credit score is low. If the major negatives on your credit score are credit utilization, and then you pay off your balances, your score can improve drastically in a single month. If your credit is low because of multiple collections and poor payment history, then it will take several months of on-time payments to see any positive movement in your score.

Does getting a new credit card hurt your credit?

Getting a new credit card can hurt or help your credit, depending on your situation. It can help to increase your credit mix and improve your credit utilization percentage, but it will add a new hard inquiry to your account and make your average credit age younger—both of which could lower your score. For those in the credit building stage adding a new credit card will most likely lower your score in the short term but lead to a stronger credit score in the long term.

What is the meaning of different level of Credit Score?

Conversely, a credit score of 700 or higher is generally viewed positively by lenders, and may result in a lower interest rate. Scores greater than 800 are considered excellent. Every creditor defines its own ranges for credit scores and its own criteria for lending. Here are the general ranges for how credit scores are categorized.4

Excellent: 800+ Very Good: 740–799 Good: 670–739 Fair: 580–669 Poor: 300–579

When should you check your credit score?

You should check your credit score regularly to check for errors, but make sure that you do so through soft inquiries (checking credit score or credit report by individual) so that your score isn’t impacted. It is advisable to check your credit score before applying for any kind of loan.  www.creditinsta.com  offer free credit monitoring to their customers.

How can you quickly improve your credit score?

While you can take quick steps to improve your credit score but it takes some time to reflect the impact of your actions and most likely you won't see a huge increase overnight. However, you can potentially speed up the process by having our revolving credit as much as possible to lower your credit utilization percentage, removing inaccurate things (especially late payments), or being added as an authorised user to someone else's old account with perfect payment history, Ideally, this is done by a friend or relative, and they do not even have to give you the card.

What is the importance of bill payment for good credit score?

Payment history has the maximum impact on your credit score. So, it’s better to have paid-off debts (such as your student loans, credit card bills) remain on your record. If you paid your loans responsibly and on time, it works in your favor.

What can we do to ensure bill payment on time?

By keeping track of monthly bills on paper or digitally Setting due-date alerts, so you know when a bill is coming up Ensuring sufficient balance in your bank accounts to make the payment on time Automating bill payments from your bank account We have several mobile apps to facilitate quick bill payment Making full payment of credit card bill not only helps in credit score but also saves from interest payment

How to Build Good Credit Score?

Given below are few quick actions we can take to improve our credit score. Impact of these actions on credit score may take few months to reflect in credit score

Pull all your credit reports from all major credit bureaus in the country Set payment due date alert to know when a bill is coming up. On time bill payment is one of the most important steps in improving your credit score. Make the maximum payment to keep the utilization of the credit limit between 30%-50% Don’t close older credit card accounts Do not apply for too many new loans or credit card in a very short window. Consider consolidating your debt and make timely payment You can sign up for credit monitoring services quickly through www.creditinsta.com, and they will help you keep on top of your credit score.

 

MSME Sector in India

What is MSME?

As per government of India notification effective 1st July 2020, classification of of micro, small and medium enterprises, namely: —

• a micro enterprise, where the investment in Plant and Machinery or Equipment does not exceed one crore rupees and turnover does not exceed five crore rupees;
• a small enterprise, where the investment in Plant and Machinery or Equipment does not exceed ten crore rupees and turnover does not exceed fifty crore rupees;
• a medium enterprise, where the investment in Plant and Machinery or Equipment does not exceed fifty crore rupees and turnover does not exceed two hundred and fifty crore rupees.

What is the importance of MSME sector in Indian Economy?

• MSMEs contribute 30% of India’s GDP
• The share of MSME-related products in total exports from India during 2018-19 is 48%.
• MSMEs are responsible for 50% of the total exports of the country.
• MSMEs are accountable for one-third of India’s manufacturing output.
• MSMEs employ around 120 million persons, becoming the second-largest employment generating sector after agriculture.
• With approximately 45 lac units throughout the country, it contributes about 6.11% of GDP from manufacturing and 24.63% of the GDP from service activities.

What is the impact of Digitization on MSME sector in India?

• 6-7 year ago ~70% of the MSMEs did not have access to digital ecosystem, today this number has come down to below 20% with the help of outstanding support from government and private sector.
• Seeing a QR code to enable digital payment in front of a very small chai shop is very normal in our country today
• Use of WhatsApp to communicate with the customer, YouTube to learn new thing and other social media platform to reach out to customers is very common these days

What are the key challenges faced by MSME sector in India?

• One of the critical challenges facing MSMEs in India is access to finance. Due to their small size and lack of collateral, MSMEs often find it difficult to obtain loans from banks and other financial institutions. This lack of access to capital prevents them from investing in new technologies and expanding their businesses.
• With the increasing adoption of new technologies, MSMEs need experienced workers to operate these technologies. MSMEs also face strong challenge to find skilled labour.
• MSMEs also face stiff challenge from large businesses in terms of price, quality and services with their deep pocket and economies of scale.

Who can help MSMEs to have easy access of funds?

• CreditInsta with their unique advantage of Credvisors with 20+ years of experience in business and consumer lending can help cheapest possible loan to expand the business
• Diverse relationship of CrditInsta in terms of funding partners help business negotiate their best term and condition to get the loan in shortest possible time.
• It is relatively easier to get the business loan for women
• CreditInsta has completely fair and transparent process to get the lowest interest rate possible for business loan.
• CreditInsta can help you get the business loan between Rupees 50,000 – 50 Crores

What are the key criteria for MSME business loan?

• An established business that has been in operations for more than One year
• A minimum turnover of ? 100,000 or more every month in last 6 months
• The business should not fall under blacklisted/excluded list for SBA finance.
• Trusts, NGOs and charitable institutions are not eligible for small business loans.

 

 

About ApnaRupee

ApnaRupee is one of the closest and credible partners of CreditInsta. Both companies believe strongly about creating world class experience while generating maximum value for the customers.

Apnarupee was established in the year 2009 and is pride to serve numerous clients with its best home loan guide services. ApnaRupee is committed to providing our clients with the highest quality financial services combined with the lowest rates available in your area.

We ensure that you get a financial solution that is tailored specifically to meet your financing needs. Whether you are purchasing your dream home, refinancing an outstanding loan, or consolidating debt, our highly experienced team of loan officers can help you find the right loan program at the lowest rate no matter what your needs are.

We look forward to working with you. We do our part by bringing people together with reliable brokers in their own state and town. We find the lenders in your community and bring them to you, so you can choose the best rates.

Mission Statement of ApnaRupee:

Our ultimate goal is to create lasting relationships with each of our clients so that we may continue providing excellent service for many years to come. Unlike many of the larger nationwide mortgage companies that are out there, all your information will be kept secure and private.

Customers' feedback and appreciation is source of our motivation

1. Credvisors are outstanding

I had opportuntiy to avail the service of CreditInsta for last 5 years. They manage my home loan, personal insurance and car insurance. I believe, I  am able to save at least 10% on my loan iterest expense, Whil buying my second home they really helpe me get the maximum loan possible which helpd me avoiding the borrowing from friends and family

- Client is one of the top executive in Fortune 50 Company

 

2. Credvisors are like family members –

Credvisors help me get my car insured at 11:30 pm at night, they were able to get lower premium than most of the online offers available

- Client is in Middle management of an American MNC

3. Truly emotional touch –

I needed a loan to buy my home with in 15 days, Credvisors from CreditInsta helped me to get everything done in 11 day. 

- Client is a business man from Central Delhi

Government Schemes

 

• MSME Loan Scheme
• Credit Guarantee Fund Scheme
• MUDRA Loan
• Credit Link Capital Subsidy Scheme
• National Small Industries Corporation Subsidy
• SIDBI Loan

1. MSME Loan Scheme

The Micro, Small & Medium Enterprises commonly known as MSME scheme was launched by the Government of India.

MUDRA Loan

The Micro Units Development and Refinance Agency (MUDRA) has a funding scheme where small businesses and start-ups can get financial support in low-cost credit. MUDRA loan is typically for micro or small businesses that operate in the manufacturing, trading, and services sectors. MUDRA Loans can be applied for through public and private sector banks, cooperative societies, small banks, scheduled commercial banks, and rural areas.

 

MSME Loan Scheme

The Micro, Small & Medium Enterprises commonly known as MSME scheme was launched by the Government of India to keep the working capital requirement of MSME. Any business either new or existing can avail loans up to one crore, under the MSME scheme. It will take 8-12 days to complete the process, while the approval or disapproval is granted within the first 59 minutes of the application.

Key feature

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Credit Guarantee Fund scheme

Credit Guarantee Fund Trust for Micro and Small Enterprises(CGTMSE) has been facilitating collateral-free loans for MSMEs for quite a long time now. Any scheduled commercial or regional rural bank can become a part of the CGTMSE scheme by empanelling itself as a leading authority. The agency grants loans to MSMEs based on their credit standing via the lending agencies registered with it.

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Credit-Linked Capital Subsidy Scheme

The purpose of this government business loan scheme is to fund technological upgrades in businesses. The funds can be used to undertake revamps related to the various processes involved in the business, such as manufacturing, marketing, and supply chain, so that the production cost for creating and providing goods and services is reduced.

Key Features

• Businesses can receive up to 15% subsidy on their investment in specific machinery under this scheme. It must be noted that the subsidy comes with an upper limit of Rs.1 crore. 
• An extra 10% subsidy is extended to entrepreneurs who belong to the SC/ST category and hail from the selected districts of the North-East or other hilly terrains. 

Eligibility

Sole proprietorship businesses, partnership firms, and co-operative or private and public limited companies are all eligible for loans under CLCSS.

• Small and micro-enterprises that belong to -sub-sectors specified by the Ministry of MSME will be deemed eligible for this subsidy scheme.
• Both new and existing enterprises can avail subsidy under this scheme.
• Small and micro-enterprises based in semi-urban and rural areas with a valid UAM number are also eligible.
• Typically, the enterprises include – sole-proprietorship, private limited companies, tiny industries, khadi, coir units, partnerships, village industries, etc.

National Small Industries Corporation Subsidy

The NSIC offers MSMEs two types of funding benefits:

• Raw material assistance
• Marketing assistance

Any business that qualifies as a micro and small enterprise with an EM Part-II (Optional)/ Udyog Aadhaar Memorandum (UAM) is eligible to apply for the NSIC subsidy under the Single Point Registration Scheme (SPRS).

The NSIC subsidy scheme also overlooks the functioning of an MSME and supports it in its endeavour to enrich production and quality.

Eligibility

• Micro, small, and medium enterprises that record a turnover of up to ₹250 Crores are eligible to apply for MSME loan.
• Enterprises must complete 3 years in order to become eligible for an MSME loan.
• Loan repayment records of any past loans (if borrowed) need to be presented to avail the loan.
• If you are seeking cash credit loans, you will also be asked to present details of your business.
• A good CIBIL score is necessary to seek MSME loan approval.

 

Sovereign Gold Bond Scheme

(Updated as on February 4, 2019)

1. What is Sovereign Gold Bond (SGB)? Who is the issuer?

SGBs are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity. The Bond is issued by Reserve Bank on behalf of Government of India.

2. Why should I buy SGB rather than physical gold? What are the benefits?

The quantity of gold for which the investor pays is protected, since he receives the ongoing market price at the time of redemption/ premature redemption. The SGB offers a superior alternative to holding gold in physical form. The risks and costs of storage are eliminated. Investors are assured of the market value of gold at the time of maturity and periodical interest. SGB is free from issues like making charges and purity in the case of gold in jewellery form. The bonds are held in the books of the RBI or in demat form eliminating risk of loss of scrip etc.

3. Are there any risks in investing in SGBs?

There may be a risk of capital loss if the market price of gold declines. However, the investor does not lose in terms of the units of gold which he has paid for.

4. Who is eligible to invest in the SGBs?

Persons resident in India as defined under Foreign Exchange Management Act, 1999 are eligible to invest in SGB. Eligible investors include individuals, HUFs, trusts, universities and charitable institutions. Individual investors with subsequent change in residential status from resident to non-resident may continue to hold SGB till early redemption/maturity.

5. Whether joint holding will be allowed?

Yes, joint holding is allowed.

6. Can a Minor invest in SGB?

Yes. The application on behalf of the minor has to be made by his/her guardian.

7. Where can investors get the application form?

The application form (https://rbidocs.rbi.org.in/rdocs/content/pdfs/INS181213AF.pdf)  will be provided by the issuing banks/SHCIL offices/designated Post Offices/agents. It can also be downloaded from the RBI’s website. Banks may also provide online application facility.

8. What are the Know-Your-Customer (KYC) norms?

Every application must be accompanied by the ‘PAN Number’ issued by the Income Tax Department to the investor(s).

9. Can an investor hold more than one investor ID for subscribing to the Sovereign Gold Bond?

No. An investor can have only one unique investor Id linked to any of the prescribed identification documents. The unique investor ID is to be used for all the subsequent investments in the scheme. For holding securities in dematerialized form, quoting of PAN in the application form is mandatory.

10. What is the minimum and maximum limit for investment?

The Bonds are issued in denominations of one gram of gold and in multiples thereof. Minimum investment in the Bond shall be one gram with a maximum limit of subscription of 4 kg for individuals, 4 kg for Hindu Undivided Family (HUF) and 20 kg for trusts and similar entities notified by the government from time to time per fiscal year (April – March). In case of joint holding, the limit applies to the first applicant. The annual ceiling will include bonds subscribed under different tranches during initial issuance by Government and those purchased from the secondary market. The ceiling on investment will not include the holdings as collateral by banks and other Financial Institutions

11. Can each member of my family buy 4Kg in their own name?

Yes, each family member can buy the bonds in his/her own name if they satisfy the eligibility criteria as defined at Q. No. 4

12. Can an investor/trust buy 4 Kg/20 Kg worth of SGB every year?

Yes. An investor/trust can buy 4 Kg/20 Kg worth of gold every year as the ceiling has been fixed on a fiscal year (April-March) basis.

13. Is the maximum limit of 4 Kg applicable in case of joint holding?

The maximum limit will be applicable to the first applicant in case of a joint holding for that specific application.

14. What is the rate of interest and how will the interest be paid?

The Bonds bear interest at the rate of 2.50 per cent (fixed rate) per annum on the amount of initial investment. Interest will be credited semi-annually to the bank account of the investor and the last interest will be payable on maturity along with the principal.

15. Who are the authorized agencies selling the SGBs?

Bonds are sold through offices or branches of Nationalised Banks, Scheduled Private Banks, Scheduled Foreign Banks, designated Post Offices, Stock Holding Corporation of India Ltd. (SHCIL) and the authorised stock exchanges either directly or through their agents.

16. If I apply, am I assured of allotment?

If the customer meets the eligibility criteria, produces a valid identification document and remits the application money on time, he/she will receive the allotment.

17. When will the customers be issued Holding Certificate?

The customers will be issued Certificate of Holding on the date of issuance of the SGB. Certificate of Holding can be collected from the issuing banks/SHCIL offices/Post Offices/Designated stock exchanges/agents or obtained directly from RBI on email, if email address is provided in the application form.

18. Can I apply online?

Yes. A customer can apply online through the website of the listed scheduled commercial banks. The issue price of the Gold Bonds will be ? 50 per gram less than the nominal value to those investors applying online and the payment against the application is made through digital mode.

19. At what price the bonds are sold?

The nominal value of Gold Bonds shall be in Indian Rupees fixed on the basis of simple average of closing price of gold of 999 purity, published by the India Bullion and Jewelers Association Limited, for the last 3 business days of the week preceding the subscription period.

20. Will RBI publish the rate of gold applicable every day?

The price of gold for the relevant tranche will be published on RBI website two days before the issue opens.

21. What will I get on redemption?

On maturity, the Gold Bonds shall be redeemed in Indian Rupees and the redemption price shall be based on simple average of closing price of gold of 999 purity of previous 3 business days from the date of repayment, published by the India Bullion and Jewelers Association Limited.

22. How will I get the redemption amount?

Both interest and redemption proceeds will be credited to the bank account furnished by the customer at the time of buying the bond.

23. What are the procedures involved during redemption?

• The investor will be advised one month before maturity regarding the ensuing maturity of the bond.
• On the date of maturity, the maturity proceeds will be credited to the bank account as per the details on record.
• In case there are changes in any details, such as, account number, email ids, then the investor must intimate the bank/SHCIL/PO promptly.

24. Can I encash the bond anytime I want? Is premature redemption allowed?

Though the tenor of the bond is 8 years, early encashment/redemption of the bond is allowed after fifth year from the date of issue on coupon payment dates. The bond will be tradable on Exchanges, if held in demat form. It can also be transferred to any other eligible investor.

25. What do I have to do if I want to exit my investment?

In case of premature redemption, investors can approach the concerned bank/SHCIL offices/Post Office/agent thirty days before the coupon payment date. Request for premature redemption can only be entertained if the investor approaches the concerned bank/post office at least one day before the coupon payment date. The proceeds will be credited to the customer’s bank account provided at the time of applying for the bond.

26. Can I gift the bonds to a relative or friend on some occasion?

The bond can be gifted/transferable to a relative/friend/anybody who fulfills the eligibility criteria (as mentioned at Q.no. 4). The Bonds shall be transferable in accordance with the provisions of the Government Securities Act 2006 and the Government Securities Regulations 2007 before maturity by execution of an instrument of transfer which is available with the issuing agents.

27. Can I use these securities as collateral for loans?

Yes, these securities are eligible to be used as collateral for loans from banks, financial Institutions and Non-Banking Financial Companies (NBFC). The Loan to Value ratio will be the same as applicable to ordinary gold loan prescribed by RBI from time to time. Granting loan against SGBs would be subject to decision of the bank/financing agency, and cannot be inferred as a matter of right.

28. What are the tax implications on i) interest and ii) capital gain?

Interest on the Bonds will be taxable as per the provisions of the Income-tax Act, 1961 (43 of 1961). The capital gains tax arising on redemption of SGB to an individual has been exempted. The indexation benefits will be provided to long terms capital gains arising to any person on transfer of bond.

29. Is tax deducted at source (TDS) applicable on the bond?

TDS is not applicable on the bond. However, it is the responsibility of the bond holder to comply with the tax laws.

30. Who will provide other customer services to the investors after issuance of the bonds?

The issuing banks/SHCIL offices/Post Offices/Designated stock exchanges/agents through which these securities have been purchased will provide other customer services such as change of address, early redemption, nomination, grievance redressal, transfer applications etc.

31. What are the payment options for investing in the Sovereign Gold Bonds?

Payment can be made through cash (upto ? 20000)/cheques/demand draft/electronic fund transfer.

32. Whether nomination facility is available for these investments?

Yes, nomination facility is available as per the provisions of the Government Securities Act 2006 and Government Securities Regulations, 2007. A nomination form is available along with Application form. An individual Non - resident Indian may get the security transferred in his name on account of his being a nominee of a deceased investor provided that:

1. the Non-Resident investor shall need to hold the security till early redemption or till maturity; and
2. the interest and maturity proceeds of the investment shall not be repatriable.

33. Can I get the bonds in demat form?

Yes. The bonds can be held in demat account. A specific request for the same must be made in the application form itself.

Till the process of dematerialization is completed, the bonds will be held in RBI’s books. The facility for conversion to demat will also be available subsequent to allotment of the bond.

34. Can I trade these bonds?

The bonds are tradable from a date to be notified by RBI. (It may be noted that only bonds held in de-mat form with depositories can be traded in stock exchanges) The bonds can also be sold and transferred as per provisions of Government Securities Act, 2006. Partial transfer of bonds is also possible.

35. What is the procedure to be followed in the eventuality of death of an investor?

The nominee/nominees to the bond may approach the respective Receiving Office with their claim. The claim of the nominee/nominees will be recognized in terms of the provision of the Government Securities Act, 2006 read with Chapter III of Government Securities Regulation, 2007. In the absence of nomination, claim of the executors or administrators of the deceased holder or claim of the holder of the succession certificate (issued under Part X of Indian Succession Act) may be submitted to the Receiving Offices/Depository. It may be noted that the above provisions are applicable in the case of a deceased minor investor also. The title of the bond in such cases too will pass to the person fulfilling the criteria laid down in Government Securities Act, 2006 and not necessarily to the Natural Guardian.

36. Can I get part repayment of these bonds at the time of exercising put option?

Yes, part holdings can be redeemed in multiples of one gm.