Contract Financing Scheme is a financing package based on product bundling concept of financing facilities which is already available in the Bank
The Scheme offers financing to customers who are Main Contractors or Nominated Sub-Contractors having secured contract(s) from approved awarding parties mainly government ministries, department and agencies
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
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