Collateral has been one of the traditional tools to mitigate the credit risk of credit loss. Most SMEs are first-generation entrepreneurs and have no collateral to borrow from banks, which remains one of the reasons for their poor credit. In view of this limitation of SMEs, personal guarantee financing is specifically designed to meet the business needs of Small Businesses (PE).
Assan Financing Facility Products Features
1. Existing business entities (at least 2 years old) that have the status of (sole proprietorship or partnership) are eligible to make use of this type of facility.
2. Take advantage of the financing facility of Rs. 100,000 to Rs. 2,000,000.
3. 1 to 5 years (according to the respective product type).
4. Margin rate: 6 months KIBOR + 12% per annum (will be adjusted to incorporate KIBOR changes annually.
5. Personal assurance must be obtained from sponsors / partners or directors.
6. Acceptable to the Bank, Two personal guarantees of person (s)
7. Individuals with net worth equal to or greater than the financing amount and income greater than the monthly fee may be acceptable as guarantors of the financing amount of up to Rs 1.0 million. This limit will also be applicable even in the case that one guarantor is a governmental / semi-governmental official (BPS-17 or higher within the age range of 21 to 54 years) and the other is a private person.
8. Scale government / semi-government officials (BPS-17 or above within the age group of 21 to 54 years) with income above the monthly repayment fee may be acceptable as guarantors for a financing amount of up to Rs 2.0 million.
9. Where applicable, mortgage on mobile fixed / current business assets, including plant and machinery, inventory, etc.
SME Bank Assan Financing Facility Documents Required
1. Copy of the CNIC, photograph and bank statement of the sponsor
2. Tax returns and property documents offered as collateral
3. Audited accounts (if the loan exceeds 10 million) / Finances of the last two years preferably
4. Detail and valuation of stock, plant and machinery
5. Personal guarantees
SME Bank Assan Financing Facility Collateral / Security
1. Mortgages (Urban property)
2. Hypothecation of plants & machinery/stocks
3. Pledge of Government Securities
4. Lien on Deposits/Term Certificates
How to Apply For SME Bank Assan Financing Facility
To apply for SME Bank Assan Financing Facility, visit to the nearest SME bank branch for application: https://smebank.org/our-network/
SME Bank Contact Information:
Address: 56-F, Nazim-ud-din Road, F-6/1, Blue Area, P.O Box 1587, Islamabad.
Phone: (+92-51) 9217000
Fax: (+92-51) 9217001