SME Financing

Small and Medium Enterprises (SME) is considered as thrust sector of the economy. SME is the Engine of Growth as this sector churns out 20%-25% of the country’s GDP growth.
In order to promote the SMEs, MBL has following arrays of products befitting the requirements of the diversified segments and sectors of the economy.credit facilities/limits practiced in the Mercantile Bank Limited:


  • To make business expansion and procure capital machinery and other fixed assets of the business.
  • Loan Limit Tk 0.50 lac to Tk 7500.00 lac.
  • Collateral free up to Tk 8.00 lac with the applicable conditions.
  • Repayment period- 12 months to 60 months.
  • Age limit- 21 years to 60 years.
  • Minimum 2 years experience in the respective field of business.
  • The project must be financially, economically and commercially viable.
  • Interest Rate: Attractive Rate

 

  • To meet up any acceptable working capital requirement of the business.
  • To meet up any acceptable working capital requirement of the business.
  • Loan Limit Tk 0.50 lac to Tk 7500.00 lac.
  • Repayment period- 12 months, which is renewable.
  • Age limit- 21 years to 65 years.
  • Minimum 2 years experience in the respective field of business.
  • The project must be financially, economically and commercially viable.
  • Interest Rate: Attractive Rate
  • To meet up short term seasonal need of the business.
  • Loan Limit Tk 0.50 lac to Tk 7500.00 lac.
  • Repayment period- Maximum 9 (nine) months.
  • Age limit- 21 years to 65 years.
  • Minimum 2 years experience in the respective field of business.
  • The project must be financially, economically and commercially viable.
  • Interest Rate: Attractive Rate
  • To meet up working capital requirement, procurement of capital machinery and other fixed assets for the Women Entrepreneurs.
  • Loan Limit Tk 0.50 lac to Tk 50.00 lac
  • Interest Rate: Attractive Rate
  • If Refinance is not available from BB then rate of interest to be 9.00 % p.a .
  • Collateral free up to Tk 8.00 lac in case of Term Loan with the applicable conditions.
  • Repayment period- 12 months to 60 months for Term Loan and 12 months for Continuous Loan, which is renewable.
  • Age limit- 21 years to 60 years.
  • Minimum 2 years experience in the respective field of business.
  • The project must be financially, economically and commercially viable.
  • Designed to ensure performance based borrower’s evaluation and facilitation to promote and foster sustainable growth of the business with competitive edge where performance of the borrowing concern will get preference over any other considerations.
    • To provide value added performance based credit services.
    • To meet optimum level of Working Capital requirement.
    • Financing acquisition of fixed assets related to promotion of the business interest / horizontal & vertical expansion.
  • Facility Mix - CC (Hypo) SE/SOD (General) SE and Time/Term Loan (SE).
  • Loan Limit: Tk 50.00 lac to Tk 500.00 lac.
  • Age Limit of the Borrower: Preferably between 21 years to 60 years.
  • Interest Rate: Attractive Rate
  • Incentive for eligible borrowers:
    • Slashing of interest rate by 0.50% to 1.00%.
    • Collateral Coverage may be considered at 1:1 instead of standard 1:1.25 on FSV.
  • Eligibility criteria for Incentive Entitlement: :
    • For Continuous Loan: A/C Turnover 3 times & above and full adjustment twice in a year.
    • For Term Loan: No instance of overdue installments as per repayment schedule during the year under review.
    • Limit Utilization: Not below 80%.
    • No pending status of the documentation.
  • Designed for foreign trade financing facility(ies) of the entrepreneurs in diversified sectors towards optimum utilization of their inherent entrepreneurship capacity.
  • Facility Matrix::
    • L/C (One off/Revolving) to import permissible goods,
    • Term Loan/Hire Purchase/LTR for retirement of shipping documents under L/C
    • Time Loan (One off/Revolving) to make payment of customers duty, VAT, Tax etc.
  • Loan Limit Tk 0.50 lac to Tk 7500.00 lac
  • Age limit- 21 years to 65 years.
  • Pricing :
  • L/C Opening/Acceptance Commission:
    • At Sight: 0.15-0.40 paisa per quarter.
    • DP/ Usance: 0.40 paisa per quarter and acceptance commission 0.30 paisa per quarter.
  • Margin:
    • One off: 10%-15% (minimum).
    • Revolving:: 10%-15% (minimum) with collateral support.
  • Interest Rate: Attractive Rate
  • Eligibility Criteria for Relaxations of Facility Limits, Slashing of Interest/Commissions:
    • For L/C Limit: Utilization not less than 2 times during the year ended.
    • For LTR: Due time adjustment of consecutive LTRs within a year.
    • For Term Loan/Hire Purchase: No instance of overdue installments as per repayment schedule during the year under review.
    • No pending status of documentation.
  • Age Limit of the Borrower: Preferably between 21 years to 65 years.
  • Borrower’s Eligibility:
    • Minimum 01 (one) year successful track record of import.
    • Minimum 03 months banking relationship with MBL.
  • Collateral/ Security:
    • L/C Margin, Shipping Documents, Acceptance, Hypothecation of Imported Goods, Receivables, Advance Payments, Plant and Machineries.
    • Personal guarantee(s) of owner(s).
    • Registered mortgage with Irrevocable General Power of Attorney of the property/ possession right purchased.
    • Lien on financial assets such as FDR, Scheme Deposit and other en-cashable financial instruments (preferably with MBL).
    • Other documents as applicable in compliance with the policy of the Bank.
  • Designed for receivable financing against goods or services sold/delivered on credit basis.
  • Financing to be made on recourse basis, i.e., in case of failure on the part of the client’s customer, we may revert back to the client for settlement of the liability created on account of his or her customer against credit sales made by the client.
  • Modality of financing: The client of our bank will provide the list of the receivables enumerating the names of the customers with ageing, i.e., highlighting the maturity dates of different categories of receivables as well as their impressions on those customers.
  • Eligibility Criteria:
    • The corporate clients, the receivables of whom to be factored, shall have the track record of sound and repeat credit worthy performance over a period of last 3 years.
    • The credit exposures of the concerned corporate borrowers shall at least be covered to the extent of 50% by the collateral.
    • There should not be any stay-order/ injunction from the court with respect to status of the credit exposure in the CIB reporting.
    • The corporate entity should duly be rated by the designated credit rating agency. The result of the overall rating should not be less than the stable outlook. In the Short Term status indicators should be the suggestive of no major liquidity problem in the business/ cash cycle.
    • Maximum exposure on the particular client/ business shall not exceed Tk 5.00 crore under the factoring arrangement.
  • Limit: Transaction accommodation within the purview of the arrangement shall be made on case to case basis.
  • Maximum Limit: Maximum exposure on the particular client/business shall not exceed Tk 5.00 crore under the factoring arrangement.
  • Interest Rate: Attractive Rate
  • Retention Margin: 20% to 50