Pubali Prochesta SME Loan
Pubali Prochesta SME Loan is a working capital loan offered by Pubali Bank Limited to small and medium enterprises (SMEs) in Bangladesh. The loan can be used to meet a variety of business needs, such as purchasing inventory, expanding operations, and covering operating costs.
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Small and medium-sized enterprises (SMEs) are widely acknowledged as drivers of economic growth worldwide. Their significant role in Bangladesh’s national economy is underscored by the fact that they account for over 90 percent of industrial enterprises, employ four out of five industrial workers, and contribute to more than one-third of the industrial value-added to the gross domestic product (GDP). This highlights the importance of facilitating access to finance for SMEs. In the manufacturing sector, SMEs’ share of value-added is even higher, estimated at 45 to 50 percent of the total value-added generated by the manufacturing industry. Recognizing these merits, Bangladesh Bank has stressed the need to promote SMEs, particularly in the area of financial access. To comply with the central bank’s directives and further the prospects of SMEs in the Bangladeshi economy, Pubali Bank Limited has introduced three products: Pubali Subarna, Pubali Karmo Uddyog, and Pubali Sujan. While all these products are demand loans, there hasn’t been a product dedicated to ensuring continuous financing for SMEs to meet their working capital needs. In response to this, the Research and Development Division, in collaboration with the Credit Division, has designed a product named “Pubali Prochesta SME Loan” to enhance the working capital base of SMEs and support their day-to-day operations. Below are the features of this product:
Product Object
Small and medium enterprise (“SME”) borrowers often require a source of continuous financing to sustain uninterrupted operations. Pubali Prochesta SME Loan is designed to help SMEs enhance their working capital base to meet their daily financial needs.
| Title | Features |
|---|---|
| Customer Segment | Any SME entrepreneur. |
| Purpose | To fulfill any justifiable working capital needs. |
| Nationality | Bangladeshi. |
| Age Limit | From 21 years up to 60 years (the borrower’s age must not exceed 60 at the end of the loan tenor). |
| Minimum Income | The minimum income must align with the loan amount applied for. |
Pubali Prochesta SME Loan Borrower’s Eligibility
The entrepreneur:
- Must possess skills in managing their business and have successfully managed it for at least two (2) years.
- Must be between 21-60 years of age.
- Must have a good reputation.
One exception to the above criteria applies: If an SME customer provides collateral security that fully covers the credit facility and has prior employment/business experience in the related industry, the 2-year experience requirement may be relaxed. However, the experience should be more than 1 year.
In the case of an individual, they must be Bangladeshi. If the borrower is a joint venture or company business, it must be registered in Bangladesh and have a majority Bangladeshi ownership.
- The applicant must be 100% privately owned, controlled, and operated.
- The primary business location needs to be in Bangladesh.
- Both monetarily and economically, the proposal must be feasible.
If the borrower is unable to provide collateral/security, they must arrange at least one (1) guarantor acceptable to the Bank. If the borrower is capable of offering collateral/security, guarantor requirements may be relaxed and reviewed on a case-by-case basis.
Read: Pubali Bank Car Loan
A successful track record and good credit history will be given weight.
| Title | Features |
|---|---|
| Loan Size | Tk. 2 lakh to Tk. 10 lakh for SE customers. Tk. 5 lakh to Tk. 100 lakh for ME customers (Collateral is a must). |
| Security/Collateral | Various forms of security and collateral including registered mortgages, hypothecation of assets, lien on cash collateral, personal guarantees, post-dated checks, and more. |
| Documentation | A range of documents including trade licenses, partnership deeds, identity documents, bank statements, credit reports, and more. |
| Insurance | Fire, flood, and RSD insurance as applicable. |
| Processing Fee | 1% but not exceeding Tk. 10,000.00. |
| Interest/Profit Rate | 9.00% p.a., subject to change based on market conditions and bank policy. |
| Penal Interest Rate | 1% above the regular interest rate on overdue amounts. |
| Interest Calculation | Interest is calculated on a daily product basis. |
| Interest Application | Interest is applied quarterly. |
| Stamp Charges | Relevant stamp charges are borne by the borrower. |
| Maximum Tenor of the Loan | One (1) year for continuous loan. |
| Grace Period | Not applicable. |
| Repayment Method | Accounts liabilities are adjusted every quarter through regular deposits daily/monthly/quarterly. |
| Type of Facility | CC(H), SOD |
| Disbursement Precondition | All documentation formalities must be completed prior to disbursement. |
| Debt-to-Equity Ratio | Maximum 50:50 before disbursement. |
| Deposit Procedure | Random by the depositor, no restrictions on deposits. |
| Withdrawal Procedure | By checks supplied by the bank. |
| Withdrawal Frequency | Random by the customers within the sanctioned limit. |
| Return of Cheques | To be recorded in the Cheque Return Register. |
| Balance Confirmation | Balance confirmation is obtained from account holders as of December 31 each year. |
| Stopped Cheque | A stopped cheque register is maintained. |
| Standing Instruction | A standing instruction register is maintained. |
| Other Charges | Excise Duty, Incidental Charges, Service Charges are applicable. |
| Transfer of Account | Non-transferable. |
| Duplicate Statement | Charge for issuance of a duplicate statement. |
| Closing Charge | No closing charges are realized. |
| Classification Status | Depending upon the time value after the expiry of the Cash Credit limit. |
| Repayment Method | There is no repayment schedule. Borrowers can pay back the entire loan amount on or before the expiry date. |
| Renewal | The facility may be renewed and/or enhanced based on merit. |
| Change of Interest Rate | Interest rate can be changed anytime during the tenor of the loan. |
Pubali Prochesta SME Loan Special Services
Special services may be provided to customers, including loan ledger statements, interest calculation sheets, account closure, and verification.
Common Restrictions
Various restrictions apply, including the preparation of a stock report, credit risk grading requirements, and the requirement for SME clients to operate their transactions through PBL accounts.
For any queries or further information, please contact us at:
Contact Information
- Telephone: (PABX) 9551614
- Fax: 880-2-9564009
- Email: gsdd@pubalibankbd.com