Currency Option

A currency option is the right (but not an obligation) to purchase or sell an agreed amount of a particular foreign currency at an agreed rate of exchange, at the expiry of, or during a specified period of time.

Who is this facility for?

Importers and those with known commitments such as dividends, management fees, gratuities, interest and principal repayments etc, who wish to fix the kwacha value of USD, GBP, ZAR, EUR etc.

What are the advantages?

  • Protection against currency exposure, exchange rate movements, devaluation, revaluation etc
  • Costing is effective and determined in advance
  • For importers, in a country like ours, whereby there is a period when foreign exchange is scarce, ensures availability when needed.

How does it work?

  • Clients apply for an option (purchases only for the time being)
  • Clients advise the bank the price at which they would like to buy the Forex at a determined future date
  • NBM calculates and quotes the option premium
  • Both parties sign a contract detailing the amount, rate, premium payable and delivery date.
  • A non-refundable premium is paid when the deal is concluded
  • Exchange of currencies takes place on or before the agreed date.

Facilities Offered

Finance Lease

National Bank of Malawi through Vehicle and Asset Finance Section buys the asset chosen by a customer, and allows the customer to possess and use the asset in return for specific rental payments over a specific period.

Sale & Lease Back

National Bank of Malawi buys back assets at an agreed price and leases them back to the original owner. This facility is ideal for converting capital assets into working capital when expanding your business.

Term Loans

This is used as an alternative to a Sale and Lease Back where monies are advanced with security taken over a property by a way of legal mortgage or over assets by a way of a Bill of Sale.

Revolving Credit Facility

Corporate clients can apply for revolving credit facility, which once in place can be used to acquire assets on presentation of invoice. The facility is subject to annual review.

Car ownership Scheme

We have developed an innovative car ownership scheme for those companies wishing to provide their eligible employees with finance to buy vehicles. Corporates only need to undertake monthly repayments to us.

Operating Lease

  • In an operating lease the bank purchases the asset and makes a return or profit by renting it out to different users (Customers). The Customer pays a rental to the Bank (Lessor, owner of the asset) for the hire and use of the asset and never owns the asset outright.
  • An operating lease is therefore an off balance sheet finance for the Customer (Lessee.)

Foreign Currency Account

Service/Product Target

Local exporters, individuals or organisations fully or partially funded by external sources, Malawians living abroad and any Malawian earning income in foreign currency.

Product Attributes/ Features

  • No minimum balance requirement
  • Withdraw in local currency through Malawi Kwacha operating account

Benefits To The Customer/User

  • Interest is negotiable
  • Can be used to hedge against currency fluctuations
  • Customer can hold funds in this account and only convert when conditions are favourable.

Costs To Access The Product

None

Account Opening Requirements

  • Account opening forms
  • KYC documentation as advised by the bank

Terms and Conditions

  • Customer has to maintain a Malawi Kwacha operating account
  • Account to operate in compliance with RBM Exchange Control Regulations

Foreign Exchange Contract

A Forward Exchange Contract is a contract between two parties whereby they commit themselves to exchange a specified amount of one currency for another at an agreed rate of exchange, settlement of which takes place on a fixed date in the future.

Who is this facility for?

Importers and those with known commitments such as dividends, management fees, gratuities, interest and principal repayments etc, who wish to fix the kwacha value of USD, GBP, ZAR, EUR, etc.

What are the advantages?

  • Protection against currency exposure, exchange rate movement, devaluation etc
  • No cash flows except on maturity date
  • Costing is effective and determined in advance
  • In a country like ours, where foreign exchange availability follows seasonal patterns, this becomes a practical hedge.

How does it work?

  • Clients apply for a Forward Exchange Contract facility
  • NBM calculates and quotes the forward rate
  • Transaction is agreed by telephone, email or fax
  • Both parties sign a contract detailing the amount, rate and delivery date
  • Exchange of currencies takes place on the contract maturity date
  • In the event of cancellation or lack of sufficient funds on the part of the client, the contract shall still be exercised on the maturity date. Simultaneously, the bank shall buy back same amount of foreign currency as contracted at the prevailing spot buying rate.

SME BUSINESS FINANCE

 

Purpose
To assist qualifying Small and Medium Enterprises (SME's) with working capital, capex finance, short term loans, letters of credit, guarantees and bonds.
 
Target Market
Sole proprietorships and limited companies that have sales turnover of up to K 100, 000,000 running or intend to run any business which is not on the Banks negative list.
 

Terms and Conditions

What can my business lease?

Any asset of durable and identifiable nature. This includes equipment, plant, machinery, commercial vehicles, tractors, business cars, generators, computers, etc.

Can my business qualify for leasing?

If your business is properly established and registered (sole traders, professional partnerships and companies), you can qualify for asset finance provided your business can demonstrate the ability to generate cash to meet rental payments.

How will my Business benefit from National Bank Asset Finance Section?

  • National Bank of Malawi is the biggest bank and has the capacity to provide finance for all capital assets requirements.
  • Our professional leasing team with unrivalled experience have a better understanding of Malawian business environment in assessing requirements of applicants.
  • Vehicle and Asset Finance Section is easy to contact through any National Bank of Malawi Service Centres which are available all over Malawi.
  • Repayments are flexible and are tailored to suit the cash flow pattern of your business. It could be monthly, quarterly or on a seasonal basis over an agreed time frame.
  • Leasing enables your company to employ conserved working capital profitably.
  • Normally, no other collateral other than the asset that is financed constitutes security
  • Quick decision making to meet expectations.

Contact us at:

Head Office
Lilongwe Office
7th Henderson Street, Blantyre, Malawi
National Bank, Capital City Service Centre
Tel: 01820 622 / 01823755 / 08829109
P O Box 30371, Capital City Lilongwe 3
Fax: 01820549
Tel: 01770322 / 08826386
e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.
Fax: 01774979
 
e-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

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mission-vision

 Vision

To be the most successful financial institution in Malawi with an internationally visible presence.

Mission Statement

To provide outstanding and inclusive financial solutions that deliver sustained stakeholder value.