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January 16, 2017
Domestic Banking

CBE extends the following credit facilities to its esteemed customs:

 Overdraft

  • It is a form of credit facility by which customers are allowed to draw cash beyond the deposits of their current accounts for the day to day operational needs of business.
  • The facility is availed to customers up to a maximum period of one year and it can be renewed every year based on the request of customers.

 Merchandise loan facility

  • It is a short term credit facility extended to customers against merchandise or its documentary evidence. Like Railway Receipts, Warehouse Receipts, Airway Bills.
  • Merchandise loan facility is extended to customers for a maximum period of one year and its maximum advance rate is 80% of the amount of the merchandise.

 Pre-shipment Export Credit facility

  • It is a short term loan extended to customers engaged in export business for purchase of raw material, processing, warehousing, packing, transporting the finished goods to shipment.
  • The facility can be granted to customers engaged in export sector and able to present receipts of export proceeds at least USD 300,000 or equivalent currencies, or engaged in viable business at least for two years or offer collateral.
  • The advance rate ranges from 70% to 90% depending on type of goods to be exported.
  • The facility is availed to the maximum of one year and the lending interest rate is 7.5%.

 Revolving Export Credit Facility

  • it is an advance extended to exporters upon presentation of acceptable export documents except bill of loading. It is to solve working capital problems of exporters with continuous export transaction emanating from money tied up in goods in transit of shipment.
  • Customers should submit export documents indicating the goods are in transit of shipment to port. Like irrevocable L/C way bill, insurance contract, and other documents specified in L/C.
  • The maximum advance rare is up to 80% of the value of the document.
  •  The facility is availed to the maximum of one year and the lending interest rate is 7.5%.

Special Truck Loan Financing

  • It is a term loan granted to coffee and /or sesame exporters mainly to overcome problems of transportation service prevailed in the export business.
  • To be eligible, exporters must have at least earned USD 4,000,000.00 or equivalent of other currencies during the last twelve months preceding the application date from the pertinent export business.
  • The vehicle has to be a dry cargo truck and trailer with minimum loading capacity of 300 quintals.

 Short term loan

  • It is a loan granted to customers to finance their working capital needs and /or other short term financial constraints.
  • A short term loan is granted for a maximum period of three years and the repayment can be in lump sum or in periodic installments i.e. monthly, quarterly or semi-annually.

 Medium and long term loans

  • These loans are extended to customers to partially finance acquisition or leasing of fixed business assets, establishment of new projects and expansion of an existing business.
  • A medium –term loan has a maturity period longer than three years and not exceeding a maximum period of seven years. Long –term loan has a maturity period longer than seven years. Long-term loan has a maturity period longer than seven years but not exceeding a maximum period of fifteen years.
  • Applicants for medium or long term loan must submit detailed project feasibility study or business plan and must contribute at least 30% of the total project cost.

Agricultural Input Loan

  • it is a short term loan granted to customers for the purchase of fertilizers, improved seeds and agro-chemicals.

Agricultural Investment Loan

  • It is a short to long term loan granted to customers engaged in commercial farms or agro-processing industries for working capital as well as purchase of  agro-processing machineries or equipment for plant, crop and animal production in small medium or large scale farming.
  • The applicants have to present detailed feasibility study and must commit at least 40% of the total estimated project cost.

Coffee farming Term Loan Financing

  • It is one form of credit  facility granted to customers engaged in commercial coffee farming with minimum 30 hectares of land to finance working capital needs, or new and expansion of exiting projects.
  • The applicants have to present detailed feasibility study and must commit at least 40% of the total estimated project cost.

Micro –Finance Institution’s Loan

  • It is a short to medium term loan granted to Micro –Finance Institution to alleviate their financial constraints while providing credit to micro-entrepreneurs.
  • The bank may negotiate the lending interest rate on Micro-Finance Institution's loan.
  • A foreign Bank Guarantee that covers 75% of the principal loan shall be accepted as collateral.