NIB credt processing procedure
''the proce by which a financial institution give loan to fund deficit unit is called loaning procedure''
tee are two main ;departments in NIB
1) sale staff/department (2) credit staff/department
1) sale staff:-the sale staff also play a vital role in providing credit. its main function is of picking cases from market. it goes to market &
meet with peoples &instutions & orgations who needs loans for expanding their busines and for purchaising machinery. and those peoples & firms who fulfill the requirments of nib credit process, so this sale department attract them & consult with them & provide best advisory servises for their best interest in order to not only to expand their business but also to earn profit for bank by providing loan to them.
it picking two types of cases from market
1) tenure
(2) business setup etc
in fact the sale department of nib is also the credit department. it collects the very basic information of customers & orgations. they collest it in a file in the form of questons paper. after completin it the file is provided/ handover to the credtit department. it is a form of fessibility report.
reviewe the overall file:-
in this stage the credit manager personaly reveiwe this file,&calculate the fact & figures gives in it.the credit manager appliying thier bank,s policy that it is acceptable or not.
Submition of proposal:-
1) Request of customer with their signature
(2) Branch manager recomendation
(3) Finencial statement and in case of new borrower feasibility report
(4) Security details
(5) Board resolution
(6) Partnership deed
(7) Basic fact sheet
Credit memorandom:-
Heading :- customer name, amount for which cusromer have requested and branch name.
Cient profile:
name of business, nature of business, legal status, cib information, text number, cnic number
Financial analysis :
analyse, balance sheet, income statement and cash flow.
Nib tenure:
the nib business tenure is minimum 3 years
Customers age:-
the credit manager also look at the age of customers. the minimum required age of customer for providing loan to them is 21 yesrs & maximum 65 is maximum yesrs for providing loan to customers.for example if a customer want to take loan from nib & his age is 62 yesrs. when maturity of 5 yesrs is aded with it, so it become 67. thus the bank will reject the request of the customers.
cnic:
the credit manager of nib also look at the cnic & cheke it. they pass it through pre-screaning process
ecib:- in this step the manager enter the collected informations of customers to the ecib(electronic credit information beuro).
dc:- they also enter the customer data in to dc (data check is a department that is collectivelly designesd by different banks of pakistan).
radias:
the nib credit manager also keep in mind the radius from each of the 4 sides from the bank, the maximum radius is 10 km by air not by way.
credit meeting:
in credit meeting the cash flow of the business firm or a customer is cheked that what is the sale and purchaises of the firm.in this step the following elements are also checked ,
household expenses is cheked
oprating business expenses of the firm
existing liabilities of customers that the customer have taken any loan from banks or other financial institutions or not.
after this process the following calculations are calculated,
disposible income = sale - purchaise - business expencess - house expencess.
net possible income = sale - purchaise - business expencess - house expencess-existing liabilities.
cash flow validation:
in this step the cashflow is analysed , like the analysis of sale, purchaise & utility bills etc.
security for loan:
the nib taking two types of security
1)secured loan:
in this type the nib give loan against 80%of the stock of the business
2)unsecured loan:
it is the most riskier loan & give loan with out any security,loan for hairdreser shop& for a slaughter. in another type of loan the nib also mortgages the property or house from business, and a well expert lawer help the bank in the process of mortgaging. but all the fee and expenses will be paid by the borower and not by the bank it self.
loan finalysed:-
after completing the above process loan is finalysed,and a report of it is prepared in the form of a file.
calling fmg oficer:-in this process the credit manage call to the fmg (fraud managment group). it is an employe of the concerned bank
but working at head office.
loan approval,from the credit defartment ,FMG defartment and send to the head office and in the last step bank disburse the amount to the customer account s, of the customer is allowed to either draw the whole of the amount , or either some of it from his account.