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Electronic Warehouse Receipt Financing Scheme (for rice and maize crop)

To address the food security challenges, massive investments in agricultural infrastructure, production trade, and processing is taking place across the world. Warehouse receipt financing can play a pivotal role to protect the farmer’s compulsion to sell their product immediately after harvest and collateralized commodity transactions stand themselves as security for the loan.

The commodities are stored in a licensed warehouse that issues a receipt proving that the commodities are physically placed in the warehouse. This receipt forms the basis of the financing.

The main objective of the scheme is to extend post-harvest financing to small farmers to fulfill their crop production needs through Electronic Warehouse Receipts (EWHR).

Terms & Conditions:

Operational Jurisdiction As a pilot project, the scheme has been launched for branches falling under districts of the country i.e., Okara, Kasur, Hafizabad & Sheikhupura districts.
  1. The farmers who possess warehouse receipts issued by Neymat Collateral Management Company Limited (NCMCL) after meeting all its requirements.
  2. All creditworthy farmers.
  3. Clear CWR.
  4. ORR rating up to 4.
Documents Required CNIC Copy, Loan application, Electronic Warehouse Receipt (EWR) & 2 recent photographs.
Maximum Loan Limit Rs. 1.200 million per borrower/party.

Bank’s financing will be 70% of the stock value declared by CMC/Warehouse on EWR. Minimum 30% margin on the stock value to be maintained.

Collateral Electronic Warehouse Receipt (EWR) issued by Neymat Collateral Management Company Limited (NCMCL), Bank’s lien on Electronic Warehouse Receipt, Personal Guarantee of the depositor/borrower.
Cost of Credit As per standing instructions of the Bank.
Repayment Schedule The loan under the scheme will be recovered in a lump sum within one year of disbursement.
Rate of Markup The prevailing rate of markup on production loans would be applicable with a 3% rebate on the timely repayment of a loan.
Monitoring Close monitoring would be carried out every month by establishing real-time liaison with Naymat Collateral Management Company Limited (NCMCL) by the respective Branch Manager, Zonal Chief, and Credit Operations Department. Internal Auditors of the Bank would also closely watch its progress and effective implementation.