In Ethiopia the listed below are the major type of corporate and commercial loans most, even if not all, banks provide for their customers.
- Term Loan
- Motor Vehicle Loan
- Construction Machinery Loan
- Partial Financing
- Syndicate Loan
- Agricultural Term Loans
- Idea Financing
- Overdraft Facility
- Overdraw
- Merchandise Loan Facility
- Import Letter of Credit Facility
- Pre-Shipment Export Credit Facility
- Revolving Export Credit Facility
- Advance on Export Bills Facility
- Letter of Guarantee Facility
- Import Letter of Credit Settlement Loan
General Criteria to get loan from banks in Ethiopia.
All customers applying for any type of loan/facility shall fulfil the following general eligibility criteria:
- All persons engaged in lawful and credit worthy business/investment activities, are eligible to borrow business loans.
- All persons who have defined and sustainable source of income, except condominium loans, are eligible to borrow consumer loans.
- The business credit applicant shall present
- renewed trade license for the current fiscal year, commercial registration certificate for Private Limited Companies/ or investment license and principal registration certificate for new projects.
- tax identification number /TIN/ or tax exemption certificate for all of their income.
- submit tax clearance certificates.
- The applicant and/or any of its major shareholders/subsidiaries shall fully settle any previous loss loan to the Bank, if any.
- The applicant shall never be engaged in tax evasion, or in any breach of exchange control regulations, or in any other illegal/unlawful dealings, if the information is available/circulated record is available.
- The applicant shall not have any record of mal-operation of the checking account in the banking system until the rehabilitation period is expired.
- The applicant shall fulfil at least the required minimum equity contribution.
- The applicant and/or any of its major shareholders/subsidiaries/related parties shall not have any non-performing loans in any bank.
- The applicant and/or his/her/its guarantor(s) shall give a written and signed consent for the access of his/her/its credit information maintained with the Credit Reference System and sharing of same among all other banks.
- The applicant shall present all the documents/information demanded by the Bank.
- The applicant ‘s business shall be
- financially viable,
- legally acceptable,
- technically feasible and
- environmental friendly.
- The applicant ‘s credit risk rating shall be grade 1 or 2 or 3 or 4. However, in exceptional cases, new or additional credit may be considered for other grades. Exceptional in this context shall mean loans and advances to be approved within the discretion of a designated committee, no need to forward to the next higher credit committee for approval.
- In addition to these criteria the customer has to fulfil the specific eligibility criteria for each loan and advance indicated in each credit product line.