Overdraft

The overdraft is an authorization granted to the client, allowing them to operate their current account in a debit position up to a determined ceiling. Generally granted for a period of one year, it allows the financing of the working capital requirement not covered by the DRC. The resulting debit balance is only due at the end of the authorization, unless renewed.

Advantages

  • Quick establishment of the overdraft
  • Use of the authorization only when needed
  • It compensates for the fluctuations in cash flow gap (receipts and expenses) faced by certain businesses throughout the year

Characteristics

Companies, Turnover <= 1 Billion XOF

Authorization limit

Up to 50% of the average actual quarterly creditor flows
Capped at 100 million XOF

Authorization period

12 Renewable months

Authorized overdraft interest rate

From TBB + 2 to TBB + 3.5

Non-authorized overdraft interest rate

TBB +4

Documentation

For the establishment of the line

  • BIC form
  • Completed patrimonial form
  • Headquarters location plan
  • Irrevocable payment domicile
  • Visa financial statements or certified general balance sheet for new companies
  • Commitment point (Non-liability or liability certificate as the case may be)
  • Copy of the spouse's ID card or proof if married under community property or separation of property

For the draw

  • Client request expressing the need
  • Amount and sources of forecast receipts at 90 days
  • Cash flow plan

Companies, Turnover > 1 Billion XOF

  • Rate: There are two types of overdrafts

    • The authorized overdraft for the client already benefiting from a credit line; in this case, the rate is TBB+ 4% (it is determined according to the quality of the client's profile)
    • The unauthorized overdraft for the client who does not benefit from any line; in this case, the rate is 14.75%
  • Duration: according to the client's choice and renewable as many times as necessary.
  • Amount: according to the client's needs and based on their turnover.
  • Repayment: monthly for fees (interest) and at maturity for the overdraft amount

  • Documents to be provided:

    • Financing request;
    • Financial statements of the last 3 fiscal years;
    • Commented cash flow forecast for the next 12 months (from the credit request onwards);
    • Appreciation of the operating cycle through customer/supplier practices (payment terms and conditions), commercial strategy, etc., to better understand the client's needs;
  • Guarantees: Real guarantees (Bank guarantee, pledge of DAT, equipment, etc.)