Revolving Credit Facility

A revolving limit facility provides commercial customers with a loan amount that can be withdrawn, repaid, and redrawn again any number of times, until the contract expires. The loan may be renewed through a written agreement between the borrower and the bank. This method gives businesses the ability to manage their cash needs and provides the liquidity necessary.

Product features include:

  • No fixed payments
  • Loan limit and maturity tailored to match the company’s operating cycle
  • The ability to temporarily finance the company’s external cash flow
  • Freedom to choose the financing value and tenor

Overdraft Facilities

Business overdraft borrowing is a form of credit facility that takes place when commercial customers make payments that exceed the available balance in their current accounts. This form of financing is popular amongst customers with varying financial requirements, enabling them to receive additional liquidity and manage any cash flow gaps that may arise.

Product features include:

  • Freedom of withdrawal and deposit to/from the account
  • Issuance of cheque book for withdrawals
  • Interest is calculated on the utilized balance and is debited at the end of each month

Commercial Loan

The commercial loan is a one-time loan granted to clients, typically for the purpose of expanding the business premises or financing fixed assets The loan is repaid in monthly, quarterly, semi-annual, or annual installments as agreed upon with the client. The loan ends once repaid in full.

Product features include:

  • Loan value is consistent with the needs and size of the business
  • Convenient monthly installments consistent with the size of the company’s cash flow,
  • Interest rates on outstanding balance
  • Loan tenor up to 7 years (depending on purpose of the loan)
  • Grace period may be granted – subject to terms and conditions

Letters of Guarantee

There is a wide variety of Letters of Guarantee on behalf of customers for specific purposes, including bid bonds, performance bonds, and custom bonds…etc. The bank will pay an agreed amount to the beneficiary against demand should the customer fail to fulfill the transactional obligation within a specified period of time – up to the expiration date of the guarantee.

Letters of Credit (L/C)

  • It’s a type of indirect facilities in the form of L/Cs for domestic and international trade, which is the most common arrangement used by banks for settling both domestic and international commercial transactions. The L/C guarantees the full payment of goods or services, against complying presentation of the required documents, and ensures that transactions are carried out according to the Uniform Customs and Practice for Documentary Credits (commonly called “UCP”)
  • Banks offers a wide variety of letters of credit like: Standby LCs, Transferable LCs, Back to Back LCs, LCs covering services as well as all kinds of shipment.
  • Credit means any arrangement, however named or described, that is irrevocable and thereby constitutes a definite undertaking of the issuing bank to honor a complying presentation.
  • Letters of credit are the safest means for domestic and international trade settlements for contracting parties. The bank, at the request of the customer (importer), undertakes to honor the claim amount against complying presentation of the required documents. Payment may be either ‘at sight’ or at a future deferred term or mixed payment. The Letter of Credit, which is commonly referred to as (LC) or (L/C), is binding and irrevocable.

Bills for Collection

Bills for Collections are considered a method for settling value of goods and/or services traded through both domestic or international commercial transactions. Documents related to such goods or services, are sent directly to one of the banks operating in the importer’s residence country, to be handed initially to them.

Through the Bills for Collection, Banks can handle the financial and/or commercial documents in accordance with the instructions received in order to obtain payment and/or acceptance or deliver documents against payment and/or against acceptance or deliver documents on other terms and conditions .

Discounted Promissory Notes

Banks issues discounted promissory notes – commercial checks with various maturity dates and creditors. The bank pays the value of the promissory note to the final beneficiary (discounter) prior to its maturity date. The beneficiary then relinquishes the rights to the value of the note and endorses it in favor of the bank. All promissory notes must have a specific concentration ratio and period, with the limit being reviewed annually. Interest and commission are imposed in advance at each discount transaction.