Working Capital Financing

Working Capital Financing for Finished Goods or Tijara is a Sale & Agency based financing facility for customers who sell Finished Goods on a credit basis. The facility will enable the Customers to sell their Finished Goods stock, meet their working capital requirements and enjoy the benefits of cash sales.

Under this concept the Bank will purchase the finished goods of the Customers and will appoint the Customer as its agent to sell the same goods in the market generally on credit basis. Tijara Financing can be done for local sales and exports.

Product Features

• A Working Capital Financing (Finished Goods) contract is permitted for Ready-to-Sale goods, either on Credit basis or on Cash basis and held in customer’s inventory for longer period.
• Price for the contract should be known at the conclusion of the contract.
• The price of the contract is paid on the spot with immediate delivery of goods.

Working Capital Financing for Work- in- Progress or Istisna is a contract of sale of specified items to be manufactured or constructed, with an obligation on the part of the manufacturer or builder (contractor) to deliver them to the bank upon completion. Subsequently the bank would deliver the manufactured / built item to the customer.

Product Features

• An Istisna contract is permitted only for raw materials that can be transformed from their natural state by a manufacturing or construction process involving labor. The subject matter is always a thing, which needs to be manufactured.
• If description of complete specification of the type, kind, quality and quantity of the subject matter to be produced have been given to the manufacturer and funds have also been disbursed for construction/ manufacturing then the manufacturer is bound to manufacture the Asset and cannot terminate the contract unilaterally.