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NIC BANK LOANS

NIC Bank

PERSONAL LOANS

Their personal loans offer you an opportunity to acquire assets, accomplish your educational goals and are custom made to suit your lifestyle at very competitive rates. They are available to those who have regular income to finance personal consumption and development needs. You can borrow from Kshs.100, 000 to Kshs.4, 000,000 and pay it monthly over a term from 6 months to 6 years, making it easier to budget.

Loan eligibility

In the course of repaying your loan, you may require more funds. They are able to advance you additional funds through a top up loan once you have successfully repaid the current loan for at least 6 months.

  • Original and copy of ID / passport (non-NIC Bank applicants)
  • Last 6 months bank statement (non-NIC Bank applicants)
  • Proof of income
  • 1 passport size photograph
  • Original and copy of KRA Pin certificate
  • Original and copy of utility bill
  • Introduction letter from employer on company letterhead(salaried applicants)

CAR LOANS

Their car loan is available to salaried customers to purchase a car for personal use.

Features

  • Minimum loan of Kshs.300, 000
  • Maximum loan amount depends on the customer’s ability to pay.
  • Financing up to 90% of car value
  • Repayment period: Up to 72 months

Requirements

  • Copy of the log book of car to be purchased
  • Copy of accepted sale agreement with proof of contribution
  • AA of Kenya/Franchise dealers valuation

SECURED DIASPORA LOANS

They not only offer loan to individuals who reside in Kenya but also to those in the Diaspora. Their Diaspora secured loan is available to non- resident Kenyan citizens working outside the country and their salaries are paid to an NIC Bank account or customers who transfer funds to an NIC Bank accounts on a regular basis.

Features

  • Minimum loan amount is Kshs.300, 000
  • Maximum based on the value of the security and repayment capacity
  • Repayment period of up to 48 months

Requirements

  • The applicant must be able to demonstrate proper legal status in the country of residence
  • The applicant must have lived in the resident country and worked there for not less than 6 months.

EDUCATION LOANS

Are you looking to further your studies or need to pay for your semester fees? Their unsecured educational loan can be used by students to fund their own education or education of a child, dependent or relative.

Features

  • Minimum loan amount is Kshs.50, 000
  • Maximum loan amount is Kshs.1, 000,000
  • Repayment period of up to 48 months

Requirements

  • Customer must provide an admission letter from the Institution with the fees structure
  • Loan proceeds will be made direct to the educational institution by way of Banker’s Cheque, RTGS or EFT (Transfer charges will be borne by the customer).
  • Top ups allowed as long as debt to income ratio is not more than60% subject to a maximum of Kshs.1,000,000

OVERDRAFTS

Their overdraft facility is a short term credit loan that allows you to access more than what is available in your bank account. This is a revolving facility offered to personal customers.

Features

  • Maximum limit of Kshs.20, 000 for Gold Customers
  • Maximum limit of Kshs.50, 000 for Platinum Customers
  • Overdraft facility to be accessed once per quarter on an unsecured basis
  • Virtual limit to be regularized within 30 days

SALARY ADVANCE

Their salary advance facility is granted to salaried employees to finance emergency needs awaiting receipt of salaries.

Features

  • Maximum amount is 60% on net income repayable on receipt of salary (maximum one month)
  • Facility is accessible 3 times a year
  • Customer must have been banking with NIC and salary received on current account for a minimum of 6 months

SECURED PERSONAL LOANS

Leveraging your personal assets can help you secure a loan or line of credit at a lower interest rate with NIC Bank. Personal assets could be your home, car or personal savings. The value of these assets helps their team of experts determine the rate of your loan or line of credit.

Features

  • Minimum loan of Kshs.300, 000
  • Maximum loan is based on capacity to repay
  • Financing up to 90% of value of security
  • Repayment period is up to 60 months or to retirement age/expiry of other critical docs.

UNSECURED PERSONAL LOANS

By taking up an unsecured personal loan with NIC Bank, they will not need you to provide any property or collateral to ‘secure’ or guarantee the loan.

Features

  • Minimum loan amount is Kshs.100, 000
  • Maximum loan amount is Kshs.4, 000,000
  • Repayment period of up to 72 months

Requirements

  • Certified copy of ID/ valid Passport for non – Kenyans
  • KRA PIN Certificate/ equivalent tax certificate for Diaspora clients .
  • Latest three (3) months pay slips (6 for commission staff)
  • Latest six (6) months bank statements (12 for commission staff)
  • Proof of residence document
  • Letter from employer (In NIC Bank format )
  • Check off letter (where applicable)
  • Current Contract Letter must be provided by Customers employed on contract, Commission income earners and expatriates.
  • Rental income should be channeled through NIC Bank account & Original or certified true copy of tenancy agreement provide, supported by Deed of Rental Assignment upon loan approval.

SAFARICOM DEALERS AND AGENTS

These are products that enable Safaricom dealers and agents to access funding easily for their businesses. The products include:

REAL TIME COLLECTION AND PAYMENTS

All Safaricom dealers and M-PESA agents can NOW deposit funds to make purchases for airtime or merchandise through any of the NIC Bank branches countrywide. The funds deposited in the NIC Safaricom collection Account will reflect in the dealer portal in real time.

All dealers and agents who are NIC customers can transfer funds from their accounts through both online and mobile banking platforms 24/7 directly into the Safaricom collection account. This will enable dealers and agents to place their orders via the dealer portal anytime.

NIC SASA

Under this solution NIC bank offers 4 types of financing to Safaricom Dealers/ Agents.

Float Financing: This is a product for authorized Safaricom M-Pesa agents who require financing their weekly M-Pesa float purchase.

Features

  • Limit: up to 0.5 times of the average monthly commission received by the business.
  • Maximum tenure: 5days
  • Interest: 0.041% per day or 0.21% for the 5 days
  • The funds will be paid directly into the customer selected M-PESA till
  • Repayment can be daily or a lump sum payment at the end of the 5 days inclusive of interest.

Qualifying criteria

  • The business must have been in operation for at least 12 months
  • Both NIC and Non-NIC customers are eligible

Additional requirements

  • Must be a valid Safaricom Dealer or M-PESA agent and hold a copy of a Valid M-PESA agency agreement between themselves and Safaricom Limited.
  • Completed and signed NIC application form as per account mandate.
  • Commission or residual income statements for the last six months to be provided.
  • Completed authority form allowing NIC to seek information on the business from Credit Reference Bureau and Safaricom Ltd.
  • Documentation for the business entity.
  • Board resolution to borrow from NIC Bank.
  • Completed assignment of proceeds form in favor of NIC Bank in case of default.
  • Completed letter of set off to allow NIC Bank use their commissions to offset any loan that may be in arrears.

Airtime Financing: This is a product for authorized Safaricom dealers who require financing airtime purchase.

Features

  • Limit: 5 times of the average monthly residual income (net any borrowing in form of device and motorcycle finance (Maximum amount Kshs.5 million)
  • Maximum tenure: 5 days
  • The funds will be paid to Safaricom Collection account at NIC Bank and immediately credit the dealer portal for the dealer to access the funds. These funds will specifically be used to finance airtime purchase.
  • Repayment can be daily or a lump sum payment at the end of the 5 days inclusive of interest.
  • Interest: 0.041% per day or 0.21% for the 5 days

Qualifying criteria

  • The business must have been in operation for at least 12 months
  • An NIC Bank account is required

Additional requirements

  • Must be a valid Safaricom Dealer or M-PESA agent and hold a copy of a Valid M-PESA agency agreement between themselves and Safaricom Limited.
  • Completed and signed NIC application form as per account mandate.
  • Commission or residual income statements for the last six months to be provided.
  • Completed authority form allowing NIC to seek information on the business from Credit Reference Bureau and Safaricom Ltd
  • Documentation for the business entity.
  • Board resolution to borrow from NIC Bank.
  • Completed assignment of proceeds form in favor of NIC Bank in case of default.

Device Financing: This is a product for Safaricom authorized dealers who require purchasing devices for their business.

Features

  • Limit: 0.5 times of the average monthly residual income (net any borrowing in form or airtime and motorcycle finance (Maximum amount Kshs.2 million)
  • Maximum tenure: 30 days
  • The funds will be paid to the Safaricom Collection Account at NIC Bank
  • Repayment can be daily, weekly or in lump sum payments at the end of the 30 days inclusive of interest.
  • Interest: 1.25% per month

Qualifying criteria

  • The business must have been in operation for at least 12 months
  • An NIC Bank account is required

Additional requirements

  • Must be a valid Safaricom Dealer or M-PESA agent and hold a copy of a Valid M-PESA agency agreement between themselves and Safaricom Limited.
  • Completed and signed NIC application form as per account mandate.
  • Commission or residual income statements for the last six months to be provided.
  • Completed authority form allowing NIC to seek information on the business from Credit Reference Bureau and Safaricom Ltd
  • Documentation for the business entity.
  • Board resolution to borrow from NIC Bank.
  • Completed assignment of proceeds form in favor of NIC Bank in case of default.
  • Completed letter of set off to allow NIC Bank use their commissions to offset any loan that may be in arrears.

Motorcycle Financing: This product is for Safaricom Authorized Dealers who require purchasing a motorcycle for their business.

Features

  • Limit: 0.3 times of the average monthly residual income (net any borrowing in form or airtime and motorcycle finance (Maximum amount Kshs.1 million)
  • Maximum tenure: 12 month
  • Maximum financing of 70% of the value of the Motorcycle
  • The funds will be paid directly to the motorcycle vendor as per NIC Bank agreement with Safaricom.
  • The loan will be repaid on a monthly basis on day of receipt of the residual income from Safaricom.

MORTGAGES

Choosing the right mortgage plan is a top priority when beginning the journey to home ownership. The option you choose should fit your unique needs and preferences. At NIC Bank they have a dedicated team of Mortgage specialists to walk with you through the journey towards securing your dream home.

NIC Mortgage offers you a variety of options:

  • Equity Release – Financing against your already existing house
  • Purchase Financing – Loan that funds to buy a readymade house
  • Top-Up – Increase in value of your existing mortgage due to reduction of loan amount or appreciation of property value
  • Balance Transfer/Refinance -Transfer of an existing mortgage from one financier to another
  • Construction Finance – Loan that funds the building of a residential home or residence
  • Plot Purchase – Financing to buy vacant land

Features and benefits

  • Up to 90% financing for Kenyan residents and 70% financing for Kenyans in the Diaspora.
  • Mortgage Protection Insurance (MPI) cover that takes care of retrenchment, death and disability and social perils cover included
  • Competitive Interest rates
  • Flexible repayment periods of up to 20 years
  • No penalty for early repayment
  • Available to both Kenyan citizens and non-Kenyan permanent residents
  • We arrange for valuation and legal processes by bank-appointed service providers
  • Joint applications allowed
  • Minimum amount of Kshs.1 million. Maximum amount is based on your ability to repay.
  • Interest is charged on a reducing balance basis

Requirements

  • A completed and signed Mortgage application form
  • Your Original ID/Passport (plus copies)
  • 6 months certified bank statement
  • 3 months pay slips
  • Sale agreement or letter of offer( for purchase mortgage only)
  • Letter of introduction from employer

Related costs

Cost associated with Mortgage:

  • Arrangement fee
  • Legal Fee
  • Valuation fee
  • Stamp duty on Transfer
  • Stamp duty on Charge
  • Insurance

CONSTRUCTION LOANS

This product is designed for construction of property. At NIC Bank, they offer land purchase of up to 60% financing and finance for building for up to 70%.

Requirements

  • Profile of the contractor.
  • Approved architectural and structural drawings of the proposed project.
  • Evidence of up to date land, rent & rates payment (i.e. receipts where applicable)
  • Original Bills of Quantities prepared by a registered quantity Surveyor
  • Project Implementation Schedule (Contractor’s work plan) detailing all activities and scheduled time frames; i.e. helps determine moratorium period if required.
  • Building contract agreement between borrower and contractor.
  • Approval by National Environmental Management Authority (NEMA)
  • KRA PIN certificates for the borrower.

Additional requirements

  • Evidence of project equity financing- applicants contribution
  • Certificate of Compliance from the National Construction Authority
  • Approved building plans- approved by relevant authorities
  • Approved structural plans
  • NEMA approval (for multiple units)
  • Bill of quantities – by an independent and qualified quantity surveyor, giving total project costing
  • Contractor agreement
  • For stalled projects, provide project history
  • Profiles for architect, quantity surveyor, structural engineer, project manager

PLOT PURCHASE LOAN

The plot purchase loan allows a borrower to purchase undeveloped property designated for commercial or residential development.

Features

  • Limit: Maximum of Kshs.5million subject to LTV and serviceability.
  • Maximum tenure: 5 years or end point at which the borrower, in case of self-employed, attains the age of 60
  • Loan to Value Ratio: Standard loan to value ratio

Qualifying criteria

  • Established business for at least 4 years with a good track record
  • Customer of the Bank for at least 1 year
  • Maximum two unpaid items in the last 6 months and none in the last 3 months
  • Maximum two excess drawings in the last 6 months and none in the last 3 months
  • Regular and consistent credits in the account for last 12 months
  • Maximum aggregate monthly repayments should not exceed 20% of average monthly turnover of the last 12 months
  • Debt Servicing Capacity Ratio does not exceed 40%
  • The applicant (in case of sole proprietor must be between 25 years and 65 years old).

Additional requirements

  • Evidence of payment of deposit price
  • The borrower must have clear and proven source of repayment – already existing income streams that are sufficient to meet expected repayment.
  • Security to be by way of first legal charge on the property being financed and/or another property
  • Mortgage Protection Policy for the sole proprietors or partners
  • Copy of signed sale agreement between the buyer and vendor to be submitted to the Bank.
  • Property to be valued by a valuer on the Bank’s panel
  • The business should not be in prohibited list as defined in NIC Group Policy
  • No adverse Credit Reference Bureau (CRB) report

PROPERTY PURCHASE LOAN

This loan can be used to purchase property for owner occupier or for rental income. In case of residential, this shall apply where the owner of the business shall reside. In case of commercial the property shall generate rental income.

Features

  • Limit: Subject to LTV as per master credit policy with serviceability demonstrated from existing and projected income streams.
  • Maximum tenure: 10 years or end point at which the borrower, in case of self-employed attains the age of 60
  • Loan to Value Ratio: Standard loan to value ratio

Qualifying criteria

  • Established business for at least 2 years with a good track record
  • Customer of the Bank for at least 12 months. For new customers, to provide Bank statements for 12 months and open an account with NIC
  • Account must have a maximum of 2 unpaid items in the last 6 months and none in the last 3 months
  • Account must have a maximum of 2 excess drawings in the last 6 months and none in the last 3 months
  • Regular and consistent credits in the account for last 12 months
  • Maximum aggregate monthly repayments should not exceed 30% of average monthly turnover of last 12 months
  • Debt Servicing Capacity Ratio does not exceed 50%
  • The applicant (in case of sole proprietor must be between 25 years and 65 years old)

Additional requirements

  • Evidence of payment of deposit price
  • The borrower must have clear and proven source of repayment – already existing income streams that are sufficient to meet expected repayment.
  • Security to be by way of first legal charge on the property being financed and/or another property
  • Mortgage Protection Policy for the sole proprietors or partners
  • Fire Policy over the property with Bank’s interest duly noted.
  • Property to be valued by a valuer on the Bank’s panel
  • Copy of the signed sale agreement between the buyer and vendor to be furnished to the Bank
  • The business should not be in the prohibited list as defined in NIC Group Policy
  • No adverse Credit Reference Bureau (CRB) report
  • Audited accounts must be provided for amounts above Kshs.15Million

ASSET FINANCE

The NIC Bank knows you’ve got big dreams to grow your business so don’t just sit back. Go to NIC Bank, the home of Asset Financing. NIC Bank assists clients acquire new and used movable assets at competitive interest and term rates. They have extensive knowledge of asset finance, with their team averaging decades of experience.

HIRE PURCHASE

NIC Bank understands that your business needs to run smoothly – and growing in line with your plans – you may need to buy new vehicles, equipment or machinery. This may be costly, so they offer a number of options to help spread the cost.

Their hire purchase relationship managers seek to provide financing to customers to purchase the below products amongst others:

  • Saloon cars
  • Commercial vehicles
  • PSV Vehicles
  • Buses
  • Trailers
  • Tractors & related implements
  • Contractor equipment
  • Specialized equipment
  • Office equipment
  • Industrial equipment
  • Refinancing of existing equipment/motor vehicles.

Benefits

  • Payments in convenient installments
  • Simple documentation
  • Quick turnaround time of 24 hours
  • No hidden costs like legal fees and stamp duty
  • Insurance Premium Financing for the assets purchased
  • Approval in 12 hours

Individual requirements

  • Fully Completed Asset Finance Loan Application form (available at all NIC Bank branches & motor vehicle dealers)
  • Latest 6 months’ bank statements (original or certified copies)
  • Latest 3 months’ payslips (if employed)
  • Copy of ID Card
  • Copy of PIN Certificate
  • Proforma invoice/sale agreement

In addition to the above, for used vehicles, additional documents required are:

  • Copies of logbook/import papers
  • Current market valuation report from AA Kenya, Regent Valuers or the vehicle franchise holder in Kenya.

Limited company requirements

  • Fully Completed Asset Finance Loan Application form (Available at all NIC branches & motor vehicle dealers)
  • Latest 6 months’ bank statements (Original or certified copies)
  • Certificate of Incorporation/Registration
  • Memorandum & Articles of Association
  • ID & PIN Certificate copies for all directors
  • Copy of company PIN Certificate
  • Proforma invoice/sale agreement

In addition to the above, for used vehicles, additional documents required are:

  • Copies of logbook/import papers
  • Current market valuation report from either AA Kenya, Regent Valuers or the vehicle franchise holder in Kenya

INSURANCE PREMIUM FINANCING

Insurance Premium Financing (IPF) is a facility that enables you to pay your insurance premiums in installments rather than in one lump sum amount. IPF is only taken for short term policies, that is, those that are renewable annually.

Examples of such insurance policies:

  • Fire and perils
  • Motor – Commercial or Private
  • WIBA
  • Burglary
  • Medical Insurance
  • Contractors all risk
  • Group Life

IPF allows an organization to obtain needed coverage without liquidating other assets or offering up collateral as with ordinary loans. For organizations, multiple insurance policies can be attached to a single premium finance contract allowing for a single payment plan to cover all insurance coverage.

Benefits

  • No credit appraisal for the facility to be taken up
  • Convenient and simple documentation
  • Easy application process
  • Quick processing time
  • No hidden charges or fees
  • Competitive pricing
  • Turnaround time for payment of premium to the Insurance Company is 48 hours.

Requirements

  • Copy of National ID/PIN for individual applicants
  • Copy of Certificate of Incorporation/ Certificate of Registration for business entities
  • Company PIN
  • Copy of Memorandum & Articles of Association, Partnership Deed or other constitutive document as per registered entity type for corporate entities

OPERATING LEASES

An operating lease is a contract that allows a lessee to use an asset over a specific period of time in return for periodic payments based on partial payout of the capital cost of the asset. It does not convey the right of ownership of the asset. This product offering is currently available for Small and Medium Size Enterprises (SME’s), Corporate and Government both County and Central Government.

Asset classes that can be leased:

  • Motor vehicles
  • IT equipment
  • Supermarket equipment
  • Construction equipment
  • Furniture, fixtures and fittings
  • Medical equipment
  • Industrial equipment

Benefits

  • No large initial capital required either for deposit contribution or outright purchase
  • No risks of obsolescence
  • Flexibility in lease structuring
  • Full lease rental is an operating expense thus providing a tax benefit
  • Allows flexibility at the end of the lease term such as extension on the lease or replacement of old assets for new
  • No involvement in disposal of the asset at the end of the lease term
  • VAT on the asset leased is spread over the lease term of the asset
  • Rental payments are not based on 100% cost of the asset.
  • Financial ratio benefits as assets are off balance sheet.
  • No large asset registers required as assets not owned

SME LOANS

NIC Bank offers reliable SME lending products that provide various business entities with an opportunity to grow through the provision of multiple lines of credit.

They provide business loans as per specific requirements as they ensure quick turnaround time on facility requests.

They have split the SME business line into 3 tiers:

  • Lower tier SME: those business with turnover below Kshs.15m
  • Middle tier SME: those businesses with a turnover between Kshs.15m and Kshs.50m
  • Upper tier SME: those businesses with a turnover above Kshs.51m

INVESTMENT CLUB LOANS

Club loans are typically used to finance business investments of the group and are suited for formal registered savings and investment groups.

Loan features

  • Minimum loan amount is Kshs.1, 000,000
  • Maximum loan amount is Kshs.50, 000,000 or 4 times the amount of savings, whichever is lower.
  • Maximum Tenure: 48 months
  • Loan to Value Ratio: 70% where security is pledged or being purchased.

Qualifying criteria

  • Group has to be formally registered
  • The scope of loans is to be limited to wealth creation activities.
  • Total contributions per month should exceed more than 2 times the monthly loan repayment to the bank. This should be exclusive of any income generating activity.

Additional requirements

  • Group members can co-guarantee one another
  • Copy of Trustee Deed to be submitted to the bank

INVOICE DISCOUNTING

This product allows discounting of invoices from reputable customer base in the industries.

Features

  • They finance 80% of the value of invoice or certificate subject to minimum of Kshs.300, 000 and maximum of Kshs.3, 000,000
  • Maximum Tenure: 90 days – 120 days

Qualifying criteria

  • The business must have operated for at least 2 years
  • You must have been a customer of the Bank for at least 6 months.
  • Regular and consistent credits in the account for last 12 months. Credit turnover should not show declining trend and the account should record credit balance should at least once every quarter.

Additional requirements

  • A profile and review of the company that the borrower seeks to discount their invoices to be provided to assess the company’s credit worthiness and ability to honor such payments.
  • The business should not be in prohibited list as defined in NIC Group Policy
  • No adverse Credit Reference Bureau (CRB) reports for all parties
  • The Invoice must be accepted by the payer.
  • Payer to confirm that proceeds is to be paid directly to the Borrower’s account with NIC Bank.
  • The payer is to be approved by the Bank and a tripartite agreement executed between the payer, borrower and the Bank.

MEDICAL BILL DISCOUNTING

This is a product for medical practitioners who require bills to be discounted on services rendered to patients.

Features

  • Limit: 50% of the value of claims
  • Maximum tenure: 90 days

Qualifying criteria

  • The debtor must be an insurance company or private hospital approved by the Bank
  • The business must have operated for at least 3 years
  • Regular and consistent credits in the account for last 6 months. Credit turnover should not show declining trend and the account should record credit balance should at least once every quarter.

Additional requirements

  • The customer should not have pledged a Debenture on its assets in favor of another lender
  • The business should not be in prohibited list as defined in NIC Group Policy
  • Confirmation by the Debtors that payment will be made to the customer’s account with the Bank
  • No adverse Credit Reference Bureau (CRB) report

CONTRACT FINANCING

Contract financing at NIC Bank is suitable for limited companies in contracting business to finance receivables.

Features

  • They finance 70% of the value of certificate subject to aggregate maximum of Kshs.10, 000,000 and a transaction value of between Kshs.1, 000,000 and Kshs.3, 000,000.
  • Maximum Tenure: 90 days – 120 days

Qualifying criteria

  • Borrower must be the main contractor or nominated sub-contractor
  • The tenor of the contract to be not more than 24 months
  • Client commitment to the project should not be less than 30%
  • Contractor must have sound financing standing to meet contractual obligation
  • Contractor must have been in the same line of business for not less than 3 years
  • Sponsors should be multinationals, local corporate, NGOs and government agencies and should be approved by the Bank
  • The contractor to show performance in at least 3 past contracts of similar complexity and nature
  • Not more than 50% financing on pre-implementation and 50% on post-implementation

Additional requirements

  • Signed Contractual document should be submitted
  • Confirmation letter from the sponsor giving indication of contract awarded and that payments will be paid directly to the contractor’s account with the Bank
  • Certificates for payments to be approved by the sponsor before disbursements
  • Certification of completion to be provided where applicable(part completion financing)
  • The contractor to execute a fixed and floating debenture over all its assets in favor of the bank and should not have any existing securities with another bank i.e. Debenture.
  • Deed of Assignments of Benefits under contract in favor of the Bank.

SCHOOL/COLLEGE LOANS

NIC Bank finances the expansion of infrastructure or working capital of schools, colleges and universities.

Loan features

  • Limit: 30 % of fee income receivable in a term/semester subject to a maximum of Kshs.20, 000,000
  • Repayment can be on a quarterly basis to allow for cash flow flexibility
  • Maximum tenure 90 days – 120 days for temporary overdrafts
  • 48 months for infrastructure expansion/renewal loans
  • Loan to Value Ratio: Standard loan to value ratio

Qualifying criteria

  • Limit: 30 % of fee income receivable in a term/semester subject to a maximum of Kshs.20, 000,000
  • Repayment can be on a quarterly basis to allow for cash flow flexibility
  • Maximum tenure 90 days – 120 days for temporary overdrafts
  • 48 months for infrastructure expansion/renewal loans
  • Loan to Value Ratio: Standard loan to value ratio

SECURED BUSINESS LOANS

The secured business loan is suitable for SME customers cutting across all industries. The secured loan can be used as per the need of the business.

Features

  • Minimum loan amount is Kshs.100, 000
  • Maximum loan amount is determined by serviceability
  • Maximum Tenure: Expansion of business or business start-ups with related businesses is 7 years
  • Working Capital is maximum 3 years
  • Loan to Value Ratio: Standard loan to value ratio applies

Qualifying criteria

The Business must have operated for at least 2 years. This does not apply to customers offering deposits as security.

  • For new business start-ups, business owners will have to demonstrate experience in running related or other businesses
  • For existing business, the customer must have had an account with the Bank for at least 6months
  • For business startups, customer must provide evidence of a track record in another business for at least 2 years
  • For new relationship, the customer must provide statement of account with another bank for a period not less than 12 months
  • Maximum aggregate monthly repayment should not exceed 45% of average monthly turnover of last 12 months

Additional requirements

The borrower must have clear and proven source of repayment – already existing income streams that are sufficient to meet expected repayment.

  • Repayment ability will be based strictly on existing business cash flows
  • The business should not be in prohibited list as defined in NIC Group Policy
  • No adverse Credit Reference Bureau (CRB) report.
  • Industry of the borrower must have positive outlook
  • Audited accounts must be provided for amounts above Kshs.15Million in which case the Debt Servicing Capacity Ratio should not exceed 50%

SECURED OVERDRAFT

The NIC Secured Overdraft facility can be used to finance working assets of a business, mainly stocks, trade debtors and creditors.

Features

  • Minimum loan amount is Kshs.100, 000
  • Maximum loan amount is 25% of turnover for the last 12 months.
  • Maximum Tenure: Renewable annually
  • Loan to Value Ratio: Standard loan to value ratio applies

Qualifying criteria

  • The Business must have operated for at least 2 years. This does not apply to customers offering deposits as security.
  • You must have been a customer of the bank for at least 6 months. Where the customer is new to the bank, 12 months bank statement must be furnished.
  • Trading and manufacturing businesses should be able to show evidence of the value of stocks purchased or credit sales which account for the financing need.
  • Service businesses should be able to demonstrate that the period between their production and delivery of a service and the collection of billing invoices is reasonably short. Activity must be regular and predictable. Care should be taken with service businesses with long lead times or customers who are known to be slow payers.

Additional requirements

  • The borrower must have clear and proven source of repayment – already existing income streams that are sufficient to meet expected repayment.
  • Repayment ability will be based strictly on existing business.
  • The business should not be in prohibited list as defined in NIC Group Policy
  • No adverse Credit Reference Bureau (CRB) report.
  • Industry of the borrower must have positive outlook
  • Audited accounts must be provided for amounts above Kshs.15 Million.
  • NIC to be the sole banker

CORPOATE LOANS

LINES OF CREDIT

Corporate Overdraft: This product caters for the financing of customers’ working capital cycle taking into account the lead times in procurement of stocks, the manufacturing process and any terms of supplier credit including credit extended to customers

TERM LOANS (Construction loans, Asset Based lending, Capital Expenditure loans)

Due to the long term nature of capital expenditure for companies, financing is required for a matching term. Revenue from projects and equipment on term funding is usually generated after completion hence the need to match repayments to the customers future cash flow.

REFERENCES

https://www.google.com/search?q=NIC+LOANS&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a&channel=fflb


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