Warehouse Receipt Loans (Commodity Finance)
Targeted Clients:
Agricultural Based Microfinance Institutions for financing stock/crop storage during harvest for sale at a later period when prices have improved.
Product Benefits:
- Funds when in need: Upfront payment to enable borrowers meet immediate financial needs.
- Multiple loan disbursements: Loan disbursement depending on stocks already in warehouse.
- Sufficient Amount: Loan amount depending on crop price flux.
- Better crop prices: Farmer obtains higher prices at the time of sell compared to the price at harvest period.
- Safety for produce: Crops are stored by experienced collateral manager.
- Easy Security requirements: Security shall be stored produce and cash guarantee arrangement, if any.
Eligibility Criteria:
Bank affiliate MFI, existence of warehouse, collateral manager (Preferable Bank appointed collateral Managers), security and insurance. Applicable to specific produce with less risk in damage and price. Existence of a reliable market (forward contract is more preferable). In addition, there should be a reliable arrangement among involved parties i.e. MFI, Bank and collateral manager.
For more information, contact a nearest CRDB Bank branch
Last Updated: Tuesday, 01 June, 2010