Operating Cycle Financing Line
Introduction
- Structured as a short-term loan
- Aims to support liquidity, improve operational efficiency, foster economic growth, mitigate financial risks, promote sustainability, enhance regional economic integration, improve Maghreb markets, and stimulate innovation for corporates
- Loan tenor not exceeding 24 months, with repayment at maturity
- Financing up to 80% of submitted invoices
Credit Type
Short-term credit
Target Clients
Public and private enterprises that meet the eligibility criteria set by the bank
Context
The Bank offers innovative and flexible solutions to support enterprises established in the Arab Maghreb Union’s States in financing their operating cycle.
Operating cycle financing enables eligible companies to cover needs related to their operational cycle through the following (non-exhaustive) forms:
- Production Cycle Financing: This type of financing can cover production-related costs and daily operating expenses. It helps ensure the smooth continuity of the production process.
- Accounts Receivable Financing: Designed to support enterprises facing delayed customer payments, this form of financing improves cash flow, allowing the company to meet its financial obligations.
- Inventory Financing: It helps secure the necessary materials and products for operations and ensures their availability when needed. This type of financing can assist enterprises in managing their inventory efficiently.
- Financing for the Purchase of Raw Materials, Semi-Finished or Finished Products: This type of financing helps enterprises acquire the essential raw materials needed for production. It also covers the purchase of semi-finished products used as inputs in the production process. Additionally, it can finance the purchase of finished goods.
- Export Financing: Aimed at strengthening the export capacity of enterprises, this financing provides the liquidity needed to cover production and shipping costs.
Product Features
Objective :
- Liquidity Support: Providing enterprises with the necessary liquidity to meet their day-to-day operating cycle needs.Operational Efficiency Improvement: Helping enterprises enhance their operational efficiency by ensuring timely access to financing, thus avoiding disruptions in production or service delivery.
- Growth Enablement: Empowering enterprises to seize new commercial opportunities and expand their operations by facilitating access to necessary growth financing.
- Financial Risk Mitigation: Reducing risks associated with short-term financing by offering flexible solutions tailored to companies’ needs during critical periods.
- Sustainability Promotion: Supporting enterprises in maintaining long-term market presence and enhancing their resilience to economic changes.
- Regional Economic Integration: Providing the financing needed to strengthen trade cooperation among Maghreb States, contributing to the development of a shared regional market.
- Improved Access to Global Markets: Helping enterprises in entering global markets by offering financial support to expand export operations.
- Private Sector Innovation Stimulation: Enabling companies to invest in new technologies and innovative products to boost their competitiveness.
Financing Ratio:
- Accounts Receivable Financing: Up to 80% of submitted invoices (subject to financing) that are accepted by the bank will be financed.
- Production Cycle and Inventory Financing: The financing amount is determined following a file review and assessment of the company’s specific needs.
Loan Term:
Duration: Based on operational needs, not to exceed 24 months.
Interest and Profit Margin Payment Schedule:
Payment frequency is determined according to the type of financing granted (quarterly / semi-annually / bullet payment at maturity – In Fine).
Principal Repayment Schedule :
At maturity / In periodic installments in certain cases.
Financial Terms:
Financial conditions are determined based on the bank’s pricing policy:
- Interest Rate or Profit Margin: The interest rate (fixed or variable) is set according to the nature and risk profile of the financing application and in line with the bank’s pricing policy.
Marketing Approach
- Direct marketing.
- Digital marketing.
- Marketing through international and localfinancial institutions.