Askari Flour Mill Finance

Askari Bank offers Flour Mill Finance (CF and RF) to meet seasonal financing needs of wheat procurement and working capital requirement.

Purpose
Cash Finance Running Finance
To meet working capital requirements of flour mill business for procurement of wheat as per milling capacity To meet working capital requirements i.e. transportation, salary & wages, utility and other administrative expenses etc. (Procurement of wheat through RF funds is restricted)
Max Financing Amount

ME: Up to Rs. 75M (Maximum)*
SE: Up to Rs. 25M (Maximum)*
*RF to be capped at 15% of CF limit
Markup Rate

3 Month KIBOR + 3% p.a. (Cash Finance)
3 Month KIBOR + 3.5% p.a. (Running Finance)
Processing Fee

@0.15% of total limit(s) processed/approved or Rs. 25,000/- whichever is higher.
Other legal/evaluation charges at actual will also be charged
Tenor (RF & CF)

One year as per clean up corridors
Insurance

Property (building only) and stock insurance to be obtained in favor of AKBL
Security
Cash Finance Running Finance
  • Collateral: Pledge of wheat with 10% margin or as per SBP requirement
  • Additional Security: Minimum 25% of CF limit to be secured through value (MV) of the mortgaged residential/industrial/commercial property (Land & building only), as per AKBL’s credit policy.
    Remaining available cushion can be used towards other finance facilities.
  • Cash collateral in shape of DSCs/AKBL Certificates/Lien over Account with 10% margin OR
  • Other Bank’ term certificates with 20% margin OR
  • Combination of both property & cash collateral with margins as described above
  • Collateral: Hypothecation of company’s/mill’s receivables as per AKBL credit policy
  • Effective mortgage of residential/industrial/commercial property (land & building only) with 25% margin on FSV as per AKBL credit policy OR
  • Cash collateral in shape of DSCs/AKBL Certificates/lien over account with 10% margin OR
  • Other Bank’s term certificates with 20% margin OR
  • Combination of both property & cash collateral with margins as described above
  • Age of Applicant:
    Minimum 20 years
    Maximum 65 years

*Age of borrower (in case of sole-proprietorship) must be minimum 20 years, however age not to exceed 65 years at the time of application. This age can be relaxed in case of effective succession planning for business operations. This criteria is not applicable, if the business concern is a partnership or limited company.

  • Business Age:
    Minimum 3 years’ operating history of business.
  • Account Turnover:
    Minimum 50% of applicant’s sales through account turnover with bank(s). Limit approval will be preferred based on electricity consumption.
  • Electricity Bills:
    Electricity bills payment history should be regular
  • License for milling:
    Valid license from relevant authority / food authority with minimum 8 Roller Body Mill.

 

Documents required at the time of processing

  • Application form for SE/ME along with copy of CNIC.
  • Copies of company registration documents.
  • Annual/semi-annual financials (audited or in house as per SBP requirement).
  • Electricity bill as evidence of flour mill being functional.
  • Copy of security documents for legal opinion etc.
  • Legal opinion and evaluation report by bank’ approved lawyer/evaluators respectively.
  • Bank statement.
  • An undertaking to be obtained from borrower that the mill operations were not run on commissioning basis (fully or partially) during last six months.
  • An undertaking to be obtained from borrower that the subject financing will be used only for intended purposes.
  • Any other document required as per AKBL’ credit policy.

Processing of Loan
SMEC team at designated branches will process “AFMF” as per approved Product Program.