Compare the best options on the market and choose the one which best adapts to your day to day needs.
Further Below: Our Guide To Business Loans in Egypt, Everything you need to know.
Abu Dhabi Commercial bank (FAB)
- Get a loan of up to EGP 2,000,000
- Competitive interest rates
- Flexible repayment period of up to 84 months
- Loans available for any purpose
- Offers both secured and unsecured loans
- Fast payout
- Laxer application procedure
- Free application to customers
- Applicants with stable incomes are privileged
- Flexible loan limit depending on the applicant’s salary
- Offers a loan tenor of up to 5 years
- Attractive and flexible interest rates
- Offers an annual grace period of 30 days
- Lenient application procedures
- Loan purpose is diverse
- Fast approval
- Limited to Citibank customers
- Customized repayment terms
Commercial International Bank (CIB)
- Offer loans of up to EGP 3,000,000
- Annual interest rate of 15%
- Longer repayment terms of up to 8 years
- Offers both secured and unsecured loans
- Fast approval within a few minutes
- Hassle-free online application
- Offers unlimited loan purposes
- Simpler eligibility criteria
- Applicants with stable incomes are preferred
Business Loans in Egypt, All You Need To Know:
We must inform you of all the choices for business financing in Egypt. Continue reading to learn about the many credit alternatives, the most recent financial news, and all the requirements and required paperwork for obtaining this type of consumer loan in Egypt.
[UPDATE] What economic measures has the Government implemented for companies through covid-19?
The Covid-19 pandemic had a significant influence on Egypt, as it did on many other countries throughout the globe. The government effectively stepped in to protect enterprises from the crisis’s adverse effects, which affected the social, physical, and financial worth of the financial markets. The government has established many laws and regulations that would help businesses survive the pandemic independent contractors and financial assistance programs for establishments.
- The government of Egypt has released a reinforcement initiative of USD 6.4 billion to aid in increasing withdrawals in credit and debit card programs. These funds were also proposed to extend credit facilities to SMEs.
- The central bank of Egypt announced a reduction in the interest rates charged from 10% to 8% on all economic sectors such as; agriculture and construction, tourism, industry, and housing.
- All consumer loans, real estate loans, and SME loans charged to institutions and individuals were postponed for 6 months without attracting penalties and additional returns for delayed payment.
- The government put in place liquidity measures, including moratoria for pandemic-affected firms that lasted until December 2021. New grace periods and loan maturity dates were implemented by the policy
- Fees and commissions charged at the point of sale transactions and withdrawals were limited for 6 months to cut cash transactions and exercise electronic techniques. Local transfers were also waived for 3 months.
- The tax regulatory authority implemented measures to reduce dividend taxes, stamp duty charges, and suspension of tax laws governing the agricultural sector. The capital gain tax was also waived until 2021, December.
Distinguishing types of company profiles
The type of business profile you have will have a significant impact on the financing of your firm. Additionally, the type of financing your business is qualified for will differ among organizations depending on your company’s peculiarities and production levels. Below is a list of the various business categories:
- Entrepreneurs: Entrepreneurs create plans and strategies for the kind of business they wish to run. They can assess the local economy’s demands and create a business plan to address them. They can only put their plans into action though after they receive the necessary money.
- Start-ups: In terms of structures, it is on par with entrepreneurs. Although the business is currently up and running, it is not financially stable enough to qualify for substantial business loans. It must therefore operate consistently over time to grow. The acquired loans are used to fund the expansion stage.
- Consolidated companies: These are companies that have a more established track record and predictable revenue, making them dependable and trustworthy companies that give the lending institution more security. Both big businesses and SMEs are included.
- Large companies: These companies conduct their operations as widely as feasible (national or international). Their turnover is considerable, and their needs are in the millions of euros. Some of the large companies in Egypt include Ezz steel, QNB ALAHLI, and HSBC among others.
- As legal entities: They are professionals who operate for themselves and may require funding for their business. Depending on their income, they may alternatively be categorized as “consolidated companies” or “start-up firms,” but loans are designed to meet the needs of a single borrower.
- As natural persons: These individuals use personal loans to meet their financial needs. In addition to revenue from jobs, they also receive income from other sources.
Characteristics of business loans
Different business loans offer different perks depending on the lender. However, the following metrics should be applied to compare these loans:
- Amount. A business will be qualified for a certain amount of credit based on the size of the operation and the volume of turnover. A business’s likelihood of receiving a loan decreases with its size.
- Cost: This is the first factor you should think about when deciding how to finance your business. A loan is considered to be good debt if the interest rates are acceptable because it will allow you to grow your business, meet all of your financial obligations, and repay the credit without any trouble.
- Purpose. Various reasons have different loan terms, depending on your lender. Therefore, speak with your lender to learn about their requirements for any objective you have in mind, such as growing your company, purchasing equipment, and paying off supplier debt.
- Term. Depending on the organization, they can last anywhere from 1 to 60 months. The quantity, purpose, and other unfavorable requirements specified by the lender typically decide it. The time of repayment is determined by a borrower’s business profile.
- Linkage. Financing is always accompanied by associated products, particularly in banks, such as insurance, business accounts, or other items that require mandatory recruitment.
- Grace period. This spans the time between the loan’s distribution and the payment of the initial installment of interest. Usually, the organization decides this.
- Guarantee. This is relevant for large loans where the lender requests collateral in exchange for a guarantee or piece of property.
- Speed. As some loans tend to issue loans months after application, make sure to know when you’ll receive the money after your loan application is granted.
- Repayment. Understanding the terms of repayment is essential when submitting a loan application. Others demand that you repay the loan in equal monthly installments, while others expect you to repay the principal plus any accrued interest and commissions at the end of the loan term.
Where to get business loans
The advent of new businesses offering consumer loans has eroded the banks’ long-standing monopoly on Egypt’s financial sector. Egypt’s financial systems have evolved, resulting in the emergence of easily available financial options that may be customized to satisfy different financing requirements. Consequently, you can obtain a loan that meets the demands of your business regardless of how unique your financial situation is.
Which entities provide business loans in Egypt?
- Banks: These are the most dependable and popular sources of business loans. Loans are only granted to companies that, among other things, can show that they are solvent enough to repay the loan. However, faster approval times and better terms are now being offered for SME bank loans.
- Companies and private capital lenders: This category is quicker than others because it covers the process of applying for a loan and getting the money. Applications are submitted entirely online. They offer great financial products that are either on par with or better than those offered by banks.
- Alternative financing platforms for crowdlending: These are platforms managed by businesses that facilitate the meeting of borrowers and investors. Once connected, the investor has the option of providing working capital to the borrower. After the borrower starts making loan payments, the investor will receive the interest. The entire loan application process is completed online, and the applicant receives a response in about two days.
Depending on our unique financial situation, we will be qualified for a variety of financing options. To find out which loans your company qualifies for and which you can return without incident, be sure to do a thorough financial audit.
Business loan conditions
According to Egypt’s Law on Consumer Credits, every business owner requesting a loan must meet the following fundamental requirements:
- Annual income: Before providing finance, lenders will be able to evaluate your company’s solvency using these documents. To assess whether you can afford the loan you’re applying for, the lender will examine your profits and business expenses.
- National registration: The company or business looking for finance must be registered and operating per Egyptian Law, which oversees and regulates businesses in Egypt. Lenders won’t be reluctant to provide credit if you do this.
- Good credit history: Work to keep your business’ credit history with the Egypt Central Credit Register favorable. A low credit score will make it difficult for you to get loans.
- The seniority of the company: Large loans will only be made available to consolidated organizations that will be able to service the debt, even though there are loans particularly created for startups and small businesses.
Documents needed to get funding
- Company registration document ( certificate of incorporation)
- Bank statement if the application is on another bank
- Income tax returns
- Corporate tax compliance document
- VAT return
- A financial year balance sheet to show the company’s turnover
Depending on the option of the entity, these documents may be sent physically or electronically.
Other forms of financing for companies
- Business credit lines
You have access to a certain amount of money through these unique financial instruments, which you can withdraw gradually. If you want to repay the loan, you will only be required to pay back the principal amount you drew plus interest rather than the total amount.
This type of financing is best suited to self-employed people and small to medium-sized businesses when the borrower decides to settle invoices with two or fewer suppliers later. Thus, the lender transfers the funds to the supplier immediately. We then pay back the lender the loan amount plus interest and other fees.
- P2B or crowdlending loans
Through these online channels, the borrower can engage with a private investor, who will then determine whether or not to support the business project. The conditions of these credits may change depending on the crowdlending platform we use and the investor firm we choose.
- Loans with mortgage guarantee
The borrower must be able to give some sort of guarantee for these mortgage loans to be funded. The borrower is expected to supply property in this case that generally equals the loan amount.
Products to invest in our company
- Equity crowdfunding
These are virtual retailers that have recently debuted in the Egyptian financial sector. The platforms put the borrower in touch with experts and private financiers that provide funding for our business projects. Before accepting these loans, it’s critical to comprehend that the experts and investors will obtain a cut of your company’s profits as well as a stock in it.
- Business Angels
An online platform is utilized to connect the borrower and the investor, similar to equity crowdfunding. But whether or not one of its Business Angels invests in your company will be up to the organization giving these loans. The financiers will hold a share of our corporation in addition to typically funding large-scale business undertakings.
- 3F (Friends, Family, Fools)
Those that provide financial support for our business endeavors are referred to as the “3 Fs” (Friends, Family, and Fools). The terms of funding are determined by the agreements that the lender has signed.
Aid for the financing of companies
- Capitalization of unemployment
Only self-employed individuals who want to launch a business are eligible for this sort of financing. As a result, they receive unemployment benefits that are intended for them.
Through the use of crowdfunding sites, borrowers can acquire cash from sponsors who are interested in our projects. For possible investors to identify and get in touch with them, the business owner or entrepreneur provides information about their projects on a platform.
About this page, our methodology
What is this page for: our main goal is to help you choose the finance option that best suits your financial requirements. We combine the greatest information currently available regarding consumer credits and what factors to consider in examining options that help you select the most alluring product at the time.
Source: The information regarding the main characteristics of loans in Egypt and their current regulation comes from the Financial Regulatory Authority laws, Government portals, and financial institutions such as the Central Bank of Egypt among other reliable sources.
Methodology: The data relating to the conditions of these products (amount, term, interest, etc.) have been obtained through online research and consultation of the official statistics of the aforementioned reference sources.
About us: FUNDGECKO is a comparison website that helps customers who are unsure about personal loans or which service to select. We assist our users in making informed decisions by arming them with all the information they need about consumer credits and how to select the choice that best suits their needs.
Note: the services we offer are totally free for the user, as FUNDGECKO obtains its income from advertising and its featured products.