That's right.
An Agribusiness Line of Credit (ALOC) is a revolving facility tailored for Regional and Agribusiness clients offering flexibility, value and control. It offers the flexibility of a facility which is annually reviewed and has no set repayment making it an ideal product solution for a business that is looking for a long term cash flow solution. In addition, an ALOC allows for the capitalisation of interest which provides benefit to our Agribusiness clients given the seasonality of the industry.
As an ALOC is a revolving facility, similar to the Business Line of Credit (BLOC) pricing will also be similar for this facility with an establishment fee, interest rate and a line fee charged on the ALOC.
Line of Credit
Rate Build-Up
Rate
Not quite.
Even though a Business Line of Credit is a revolving facility and could potentially be used in this scenario, it does not allow for interest capitalisation nor considers the seasonality thus making it an unsuitable solution for the client.
Not quite.
A Bank Guarantee is not appropriate in this scenario as it is a contingent liability. It is used when a borrower needs to guarantee certain terms to a third party. A Bank Guarantee is called upon by the favouree when the borrower fails to meet the agreed terms.
