mission-vision

Vision

To be the most successful financial institution in Malawi with a
visible presence in Southern Africa.

Mission Statement

To provide the best financial services in Malawi and the region, distinguished by outstanding service, product innovation and sustained earnings growth.

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Agricultural Loans & Seasonal Overdrafts

Seasonal Overdrafts For Agriculture

This is a seasonal facility made available to the agriculture sector, mainly tobacco growers to assist with the growing and marketing of the crop.
 
Other commercial enterprises elligible under this facility include seed maize, tea, coffee, sugar cane and livestock producers.

Borrowers are allowed to overdraw their current accounts against agreed cash flow projections up to an agreed seasonal limit.

The facility is available either in Malawi Kwacha or US Dollar depending on the currency of the revenue streams.
 
This facility provides farmers with seasonal financing requirements e.g. fertilizer and chemical purchases, payment of wages and rations, tenants' crop purchases, transport etc.
 
The Bank allows draw downs monthly, quarterly etc. in line with cash flow agreed between customer and the bank.
 
Qualified Agricultural Officers visit customers, to give advice where necessary.
 
The Bank monitors proceeds of sales received from Auction Floors and other established markets. The Bank registers a Tobacco Stop Order with Auction Holdings Ltd or enters into irrevocable arrangements with produce buyers to pay sales proceeds through growers' accounts with the bank.
 
Interest is charged at an agreed rate, usually a fixed number of points above the base rate.

Prospective Customers

  • Smallholder farmers with not less than 3 years experience in growing tobacco.
  • Sole proprietors, mostly Malawians in the rural areas, who farm on their own land or leased land.
  • Tobacco farmers.
  • Commercial farmers.
  • Limited companies engaged in the growing of tobacco   and other commercial crops.

Special Requirements

  • Customers are usually required to put up a contribution of up to 40% of the total financing requirement from their own funds.
  • Crops must be grown on land held on a freehold or leasehold by the farmer and grower must be registered with the authorities where applicable
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Agristorage Facility

The European Investment Bank (EIB) and National Bank of Malawi (NBM) have a joint facility for EUR 30 million for lending to customers to facilitate purchase, construction, renovation and extension of warehouses and agristorage assets. The facilities under this loan will be called “grain storage assets”.

What is an Agristorage Facility?
It is medium to long term financing provided by the Bank to eligible
customers to facilitate purchase, construction, renovation and extension
of warehouses and grain storage assets.

What is the purpose of the facility?
• To increase the grain storage and warehousing space and capacity in Malawi.
• To provide relatively lower cost and long term finance which is not usually available in the country.
• To facilitate the deepening of the Agriculture commodity exchange market in Malawi.
• To facilitate availability of easily accessible third party grain storage in the country.

Projects to be financed by Agristorage Facility
Tangible new investments or expenditures undertaken by eligible Beneficiaries, which can be identified in terms of location, design and benefits, carried out recently, and not completed before 6 months prior to the date of the application for finance. This includes investments in working capital towards construction of the warehouses or grain storage assets.

Eligible Investments
Investments and expenditures eligible for allocation of funds, as part of the projects by beneficiaries, include:
1. Purchase, renovation or extension of tangible assets, that is, warehouses, silos etc.
2. Financing of land purchase, which is technically essential for the agro investments for up to 30% of total Project cost.
3. Purchase of patents and licenses where necessary for the technical implementation of the Project.

Who can benefit?
• Private sector enterprises defined as an entity engaged in an economic activity, irrespective of its legal form; thus encompassing family firms, partnerships, companies and associations regularly engaged in agro-business.
• NBM reserves the right to determine who qualifies as an eligible beneficiary.

Loan amount that can be extended to final beneficiaries
• $1 million to $5 million per applicant.
• Customers have to demonstrate having put in owners contribution in the project.

Term of the loan to final beneficiaries
• The loan repayment period is a minimum of 4 years and a maximum of 7 years.
• The loans have a moratorium for the construction period of the financed grain storage assets of up to 24 months.

How much will it cost?
• We offer competitive pricing, with interest rates of around 7.5% fixed per annum.
• There is also a one-off fee for arrangement and appraisal.

CONTACT US
Call Centre Help Line: +265 (0) 1 831 485
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.  or  This email address is being protected from spambots. You need JavaScript enabled to view it.
Whatsapp: 0212 831 485
Skype: nbmcallcentre

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Bonds & Guarantees

Tender Bond

Issued in support of customer's tender as assurance of the intention of the customer to sign the contract if the customer's tender is accepted.
In the event of default (i.e. failing to accept the contract if awarded to the tenderer) the guarantor provides within the limits of the guarantee to make payment of a stated sum of money to the beneficiary.

How will my business benefit?

If you were tendering for the supply of goods or construction of a project the employer (buyer) would normally request a 10% cash deposit to enable you to tender for the contract. If the bank issues
 
 the Tender Bond on your behalf, the bank undertakes to accept responsibility for the financial obligation and therefore a cash deposit normally becomes unnecessary.

Prospective Customers

All corporate customers involved in tendering or supply of goods to government and other major organizations, also foreign companies aiming to tender for work in Malawi. 

Special Requirements

The customer needs to set a limit for such obligations, with his/her Service Centre Manager or Account Relationship Manager and a counter indemnity from the customer needs to be taken.

Performance Bond

A performance bond is given in support of a customer's obligation to fulfill a contractual commitment, normally required after a customer has been awarded a contract to perform.

How will my business benefit?

When a performance bond is issued on behalf of our customer, the bank guarantees to the third-party (buyer or employer) that the bank will pay any claims that may arise due to non-compliance or faulty completion by the supplier or contractor, up to the total amount of the amount guaranteed.
In the absence of this guarantee, customers who are awarded contracts after tendering are required to put cash up-front, thus risking straining their cash flow.

Prospective Customers

  • All corporate customers involved in tendering or supply of goods to government and other major organizations.
  • Foreign companies wishing to tender for work in Malawi. In this case, we normally require a counter guarantee from an overseas Bank.

Special Requirements

Like all types of guarantees/bonds, the customer needs to agree a limit with the Bank.

Advance Payment Guarantee

This type of guarantee is available to our customers who tender for major contracts.
 
When a contract is awarded there is usually an arrangement for the contractor to make drawdowns under the contract or to obtain advance payments.
 
The normal advance payment is 10% of the contract amount but may be more and payable at specified stages of project implementation.
 
If the buyer/employer wishes to have security for his advance payments, he will ask the supplier/contractor for a guarantee that the monies being advanced to the supplier/contractor will be re-paid within the validity of the contract.

How will my business benefit?

The advance payment guarantee acts as security to enable you to obtain cash in advance to enable you to finance your project, and then complete it as per the terms of the contract.

Prospective Customers

  • Corporate customers engaged in major supply of goods or construction contracts.
  • Overseas or local contractors wishing to bid for major construction projects in Malawi, such as road construction.

Special Requirements

Like all types of guarantees/bonds, the customer is required to set a limit for guarantees/bonds with his/her Branch Manager or Account Relationship Manager.

Retention Money Guarantees

Given in support of contracts, which call for, say, 10% of each payment to be withheld until the project is completed and accepted by the contracting buyer - sometimes up to one year after the completion date.

How will my business benefit?

The guarantee enables the contractor to receive the total amount of each payment, whilst assuring the buyer that the funds will be refunded if the contractor is not able to fulfill his/her obligation or there is defective workmanship, repairs will be done at no cost to the buyer.

Prospective Customers

  • Corporate customers who are involved in major construction work
  • Overseas or local contractors involved in major construction work.

Customs Guarantee

Customs authorities normally request that import duty or customs duty should be paid for either in cash or bank certified cheques.
Customers wishing to pay duty by means of their own cheques can obtain a guarantee from the bank. In this way the bank undertakes to Malawi Revenue Authority (MRA) that it will honour all correctly drawn cheques up to a certain limit per day.

How will my business benefit?

Customers avoid the risk of carrying large amounts of cash for customs duty, or the expenses of purchasing a Bank certified cheque each time a cheque is required.

Prospective Customers

All customers who import and have trading licenses.

Special Requirements

Customers have to set up a guarantee limit with the bank.

Other Types of Bonds, Guarantees

Our bank is able to establish other special guarantees upon request.
These include:
  • Bonded warehouse
  • Manufacturers rebate
  • Surtax bond
  • Temporary importation of goods for re export
  • Immigration guarantees
  • Shipping guarantee
Some of the specialized bonds are pre-printed on Malawi Revenue Authority (MRA) documents and customers must first establish with MRA whether the guarantee is to be issued on the Bank's format or MRA special forms. It is usually a requirement that the bonds/guarantees issued in favour of government or MRA are executed under seal. 
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Capital Expenditure Finance

Short and Medium Term Loans

Term loans are available to help large estates acquire items of capital nature such as tractors, irrigation equipment, construction of tobacco curing barns, etc.  The loans are available both in Malawi Kwacha and US Dollar.

How will my business benefit?

  • Term loans are useful if you want to spread the cost of your investment over a period of time so as to avoid unnecessary strain on your Cashflow.
  • Term loans are for specified fixed period with repayment schedule (normally in annual instalments) over an agreed period normally not exceeding 4 years.

How much will it cost?

Interest is calculated at an agreed rate over the full amount of the loan or the outstanding amount whichever is the case.
Interest will be debited to your operating current account which is usually the seasonal overdraft account.

Prospective Customers

All large estates engaged in production of tobacco and other commercial crops such as tea, coffee, seed, and maize.
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Advances Against Outward Collection

This is similar to the export discount facility. The difference is that in this case an advance against an outward collection represents only a proportion of the bill amount. The bank is not a party to the bill.
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Export Bills Negotiation

Companies who export goods outside Malawi by way of inward confirmed irrevocable letters of credit may obtain an advance of up to 90% of the value of the export letter of credit - from the Bank.
 
Once the relative export documents under the export letter of credit are submitted to the Bank, the Bank will negotiate the documents and accompanying bill of exchange (draft) drawn at either sight or usance.
 
It is imperative that all the parties to the Letter of Credit are of good standing. Negotiation is on a strict recourse basis.
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Export Discount Facility

Export customers who sell their goods on the open account but against firm orders from their buyers overseas, can obtain funding from our bank.
 
Once the bank is satisfied with the credit standing of the buyers overseas, the bills of exchange, and supporting documents covering the exports will be discounted at the Bank's counters.
 
This takes the form of purchasing a sight bill or term bill of exchange for less than its face value(usually 90% of the face value of the bill).
 
This form of financing improves our customers' cash flow by providing immediate funding against export documentary collection. 
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Finance for Exports

Pre-Shipment Finance

For exporting customers our Bank is able to provide immediate financing to enable such customers to purchase produce locally, and prepare for shipment abroad.
A good track record of export business in tea, tobacco, cotton, sugar, coffee and other export products is a pre-requisite to obtaining pre-shipment finance.
This finance is extended by way of an overdraft or short term loan, and may be extended in local currency (Kwacha) or foreign currency, depending on availability of funds in the market. 

Loans Against Trust Receipts

A loan against trust receipts enables our corporate customers to retain control of imported goods whilst undertaking to pay the sales proceeds to the Bank.

How does it work?

On receipt of shipping documents, major importers can request our Bank to store goods in a nominated warehouse under our own name, until they require releasing them against final payments.

Prospective Customers

Major importers, who order goods in bulk and have well-established reputation, but have a seasonal cash flow problem. 

Export Discount Facility

Export customers who sell their goods on the open account but against firm orders from their buyers overseas, can obtain funding from our bank. Once the bank is satisfied with the credit standing of the buyers overseas, the bills of exchange, and supporting documents covering the exports will be discounted at the Bank's counters.
 
This takes the form of purchasing a sight bill or term bill of exchange for less than its face value(usually 90% of the face value of the bill). This form of financing improves our customers' cash flow by providing immediate funding against export documentary collection. 

Export Bills Negotiation

Companies who export goods outside Malawi by way of inward confirmed irrevocable letters of credit may obtain an advance of up to 90% of the value of the export letter of credit - from the Bank.
 
Once the relative export documents under the export letter of credit are submitted to the Bank, the Bank will negotiate the documents and accompanying bill of exchange (draft) drawn at either sight or usance.
 
It is imperative that all the parties to the Letter of Credit are of good standing. Negotiation is on a strict recourse basis.

Advances Against Outward Collection

This is similar to the export discount facility. The difference is that in this case an advance against an outward collection represents only a proportion of the bill amount. The bank is not a party to the bill.
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Loans Against Trust Receipts

A loan against trust receipts enables our corporate customers to retain control of imported goods whilst undertaking to pay the sales proceeds to the Bank.

How does it work?

On receipt of shipping documents, major importers can request our Bank to store goods in a nominated warehouse under our own name, until they require releasing them against final payments.

Prospective Customers

Major importers, who order goods in bulk and have well-established reputation, but have a seasonal cash flow problem. 
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Pre-Shipment Finance

For exporting customers our Bank is able to provide immediate financing to enable such customers to purchase produce locally, and prepare for shipment abroad.
A good track record of export business in tea, tobacco, cotton, sugar, coffee and other export products is a pre-requisite to obtaining pre-shipment finance.
This finance is extended by way of an overdraft or short term loan, and may be extended in local currency (Kwacha) or foreign currency, depending on availability of funds in the market. 
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International Trade

Documentary Collection

A documentary collection is used to obtain payment when the risk of using open account is too high and where a documentary letter of credit is considered unnecessary.

How does it work?

Your shipping documents covering imports into Malawi are forwarded by your suppliers through the banking system, to one of our service centres in Malawi. The shipping documents are received with a set of instructions to release the documents against receipt of payment, against an undertaking to pay or against an acceptance of a bill of exchange.

How will my business benefit?

When you are shipping company/transport documents are sent through our bank, you are spared the problem of having to retain safely the documents in your company, and then later on arranging to remit the foreign currency for payment.
 
When the documents covered under documentary collections are processed through our bank, we are able to advise and arrange for any exchange control requirements, and also final remittance of funds to the overseas bank.
 
Through our overseas correspondents we are able to provide a worldwide documentary collection service covering both imports and exports and ensuring that funds are transferred as per the terms of instructions between buyer and seller.
 
The most important benefit is speed in transferring funds and security in handling documents.
 
 
Documentary Letter of Credit
A method of financing international trade, a letter of credit is better described as any arrangement whereby a bank, acting at the request of and on the instructions from a customer, is to make a payment to or to the order of a third party, or is to accept and pay bills of exchange drawn by the beneficiary against stipulated documents, provided that the terms and conditions of the Letter of Credit are strictly complied with.
 
In documentary Letters of Credit, all parties deal in documents, not goods.
Therefore an underlying status report on the supplier should be obtained before entering into a contract, to ensure that the supplier is a legitimately constituted and reputable concern and likely to deliver what is required.

How will my business benefit?

If you wish to import goods you ask us to open a confirmed irrevocable letter of credit and we will advise it to your supplier's bank.
 
Depending on your contract and agreement with the supplier, the letter of credit may be drawn 'at sight' or 'at usance', but normally not exceeding 180 days.
 
Payment is then made upon presentation of documents, which strictly comply with the terms and conditions of the credit.
 
This facilitates smooth operation of trade between seller and buyer and also safeguards settlement especially when Forex is scarce. Letters of credit can be opened in any currency of your choice e.g. Dollars, Euros, Rand or Japanese Yen.

Prospective Customers

  • All corporate customers who import goods or raw materials into the country.
  • Manufacturers who wish to source raw materials for manufacturing into final products and for re-export.
  • Companies importing capital equipment.
  • Importers and trading firms.

Special Requirements

Formal limits for lines of credit to establish documentary credits are determined by your service centre Manager or Account Relationship Manager.
For non-borrowing customers some upfront-cash margin may be required.
 

Trade Information

Our Bank provides trade information of various kinds as  follows:

1. Credit Information Report

Provide our importing and exporting customers with bankers' opinions and credit standing of their counterparties both locally and overseas.

2. Trade Enquires

Through our association with Malawi Investment Promotion Council, the Malawi Confederation of Chambers of Commerce and Industry, corresponding banks and other international organizations worldwide, we are able to locate overseas importers of your local commodities.

3. Letters of Introduction

 These introduce our corporate clients or executives to our overseas agents and correspondents, where from they might seek assistance and advice during their business trips. 
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Construction Loans

These are term loans of specific amounts, for construction purposes. Such loans are for a stated period of time normally exceeding 2 years but not more than 7 years.
Interest is calculated at an agreed rate on the full loan amount or the principal outstanding amount.

How will my business benefit?

  • Draw down is at various stages against the production of Architect's certificates, Engineers/Quantity Surveyors certificates or similar documentation.
  • Such loans are available to property development companies and building construction companies. Security required is the asset being financed or an alternative asset.
  • Repayments of the outstanding loan will not normally commence until the projects are completed.
  • A moratorium is agreed depending on the anticipated completion period.

Prospective Customers

  • Development companies.
  • Property development companies.
  • Well established building construction companies. 
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Foreign Currency Loans

Foreign Currency Loans 

These loans are available to our exporting customers to enable them purchase produce or crops like tobacco, rice, cotton, pigeon peas etc., locally and for export.
Loans are available against firm orders or against inward Letters of Credit as the case may be. 

How will my business benefit?

You borrow locally in US Dollars, Sterling or Rand, and convert the currency to Kwacha to enable you purchase the commodities locally.
After export, customers receive US Dollars, Sterling or Rand as the case may be, and repay loans at agreed instalments in the foreign currency that they borrowed.

How much will it cost?

Exporting customers have the benefit of enjoying much lower interest rates than the Kwacha denominated borrowing interest rates. Customers also have a hedge against devaluation as they borrow in foreign currency, receive Forex for their exports and repay Forex to the bank.

Prospective Customers

Exporting customers with Dollars, Rand or Sterling receivables that export against firm orders, or Letters of Credit. 
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Medium Term Loans

Term loans are available to enable corporate customers purchase assets whilst matching finance costs to cash flow produced by the investment.
Medium term loans are designed to help our customers with items of capital in nature such as improvements to their premises, factories and/or purchasing of equipment and processing machinery.

How will my business benefit?

  • Term loans are useful if you can predict the likely revenue streams from the investment and want to match finance costs to revenue or simply if you want to spread the cost of your investment over a period of time so as to avoid unnecessary strain on your cash flow.
  • Term loans, are for a specified fixed period with agreed  repayment schedules over an agreed period normally not exceeding 6 years.

How much will it cost?

For medium term loans, interest is calculated at an agreed rate over the full amount of the loan or the outstanding amount whichever is the case.
Interest so charged will be debited to your operating account.

Prospective Customers

All corporate customers who require purchasing of capital items or who want to improve their premises, factories etc.
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Short Term Loans

Short-term working capital loans provide fixed lump sums with an agreed repayment period of up to 2 years.
Such loans are repaid on a monthly or quarterly basis as agreed between the bank and the customer.
Interest is calculated at an agreed rate on the full loan amount or the principal outstanding.

How will my business benefit?

With a short term loan, separate loan account will be opened for your business and the loan funds are transferred to your operating current account.
Repayments can be made on a regular basis without affecting the cash flow of your business operations.

Prospective Customers

All corporate customers with short term financing needs e.g. bulk purchase of raw materials, purchase of produce for export, payment for imports etc. 
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Syndicated Loans

Reserve Bank of Malawi has set guidelines with regard to credit concentration and group or individual companies' exposure. This means that the Bank cannot lend money beyond a certain limit. In such cases NBM is capable of securing funds by involving other Banks either locally or internationally. Each bank commits to contribute a proportion of the loan under the terms of a single loan agreement between the lending syndicate and the borrower.
 
The syndicate lenders will agree on the pricing that normally includes Commitment and Arrangement fees.
This facility can be negotiated through our Corporate Banking Office based in Head Office, in Blantyre and satellite office in Lilongwe.

How will my business benefit?

  • This facility provides our customers wishing to embark on large investment projects, the flexibility of borrowing from or more different Banks of good repute.
  • This enables our corporate clients to borrow large amounts, which are not affected by credit concentration or capital adequacy constraints of the Bank.
  • Interest is charged at very competitive rates, normally at base plus a margin. The margin depends on the amount, security offered and the benefits derived from the relationship and the project.

Prospective Customers

Large corporate customers, multinationals, international companies wishing to expand in Malawi.
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