Contract Financing

Maximum Contract Amount : No minimum or maximum amount of financing

​Repayments : Can be OD,Trade Facilities or Bank Guarantees

Interest Rate : Base on facilities

​Speed : 1-3 Months


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Overview

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Contract Financing which is specifically tailored for a specific project or contract..Financing which is specifically tailored for a specific project or contract. The financing package varies in accordance to the type of contracts i.e. construction (civil, infrastructure), supply, services etc.

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The financing package provides financial support through every stage of the project.

 

Contract Financing


Financing which is specifically tailored for a specific project or contract..Financing which is specifically tailored for a specific project or contract. The financing package varies in accordance to the type of contracts i.e. construction (civil, infrastructure), supply, services etc.

The financing package provides financial support through every stage of the project.

For construction project, pre and post construction financing can be arranged.

 

Eligibility


•  Contractors with good track records with awarders who are acceptable to bank
•  Contractors/Sub-contractors must be registered with Constructions Industry Development Board

    (CIDB) and Pusat Khidmat Kontractor (PKK) or any other relevant authorities.


Financing Facilities 


We have a range of financing facilities that can be tailored to your project needs:

•  Overdraft (Against Contract/Claims)
•  Trade Facilities
•  Bank Guarantees (Tender Guarantee/Advance payment Band/Performance Bond)


Flexible Financing Option


•  No minimum or maximum amount of financing*
•  Possibility of financing up to 3 claims per project at any one time

 

How Does Contract Financing Work

 

Features And Eligibility Criteria

General Features

Contract Financing Scheme is a financing package based on product bundling concept of financing facilities which is already available in the Bank

 
Mechanics of Financing

Purpose of the loan facilities is to finance the implementation of contract(s) until full completion
The financing mechanism works by way of assigning the contract proceeds from the awarding parties direct to the Bank. Financing is offered on a pre-implementation or post-completion basis, or a combination of both


 
Types of Contract

Supply contract / direct supply or with added value in the form of installation, testing, commissioning, training, etc
Construction and infrastructure projects including civil, mechanical, electrical and information & communication technology works
Other business services contract including provision of service and maintenance

 

Eligibility Criteria

Applicant must be the Main Contractor or Nominated Sub-Contractor
 
Applicant must be registered with either of the following

  • Ministry of Finance (MOF)

  • Contractor Service Centre (PKK)

  • Construction Industry Development Board (CIDB)

  • Other relevant licensing or registration bodies

 

Financing Concept

Pre-implementation financing: Normally comprises guarantees as provided for and required under the contracts, as well as working Capital financing to facilitate the completion of the contracts

Post-completion financing: Strictly financing on discounting of invoices already submitted to awarding parties or progress claims duly certified by the awarding  parties
 
Margin of Financing: The Bank may finance up to 100% of the contract cost
 
Financing Limit: The financing limit for fund-based facilities (excluding Guarantees) is guided by the highest deficit position from the contract’s projected cash flow