• Mudharaba Investment: - A partnership between CBO and eligible customer (entrepreneur), profit and loss shared as per the agreed profit sharing ratio.
• Musharaka Investment: - It is a joint ownership of property or equipment or commercial enterprise. Partner shall share profit as per the agreed ratio while losses are shared in proportion to capital contribution of partner.
• Diminishing Musharakah: - is a form of co-ownership in which two or more persons (i.e., the bank and the client) share the ownership of a tangible asset in an agreed proportion and one of the co-owners/client undertakes to buy in periodic installments the proportionate share of the other co-owner/bank until the title to such tangible asset is completely transferred to the purchasing co-owner/client.

KAFALA (LETTER OF GUARANTEE FACILITY)

Kafala is a written promise by the bank to compensate (pay sum of money) to the beneficiary (local or foreign) in the event that the obligor fails to honour his/her/its obligations in accordance with the terms and conditions of the guarantee/agreement/contract. Types of Kafala/Letters of Guarantee offered by CBO:

• Bid Bond
• Performance Bond
• Advance Payment Guarantee
• Retention Payment Guarantee
• Letters of Indemnity for Missing Documents
• Customs Duty Guarantee

• Wakalah Letter of Credit : - written undertaking by a bank given to the seller at a request and/ or the instructions of the buyer under wakala contract, to make payment or to accept and pay bills of exchange (Draft) drawn by the seller up to a stated sum of money within a prescribed time limit and against stipulated documents provided that the terms and conditions of the credit are complied with.
• Murabaha Import Letter of Credit : - is a contract whereby CBO buys goods for the customer (applicant) and the customer agrees to later buy the goods from the CBO through a resale at a mark-up price.
• Musharaka Letter of Credit: - is a contract whereby the value of the letter of credit issued by CBO and the profits of the partnership transaction are shared between CBO and the customer based on an agreed ratio.
• Wakala Export Letter of Credit: - is a condition where the exporter appoints CBO as his/her agent to collect receivables on his/her behalf.
• Wakala Documentary Collection (Wakala Cash Against Document - CAD): - It is type of transaction by which importer and exporter conclude a contract, accordingly the exporter deliver documents to the importer through his/her bank to buyer bank through which, the title for purchased goods is released to the buyer after the total sale price is collected in full.
• Wakala Advance Payment : - a transaction in which an importer makes payment for items to be imported prior to the shipment of goods. The importer must trust that the supplier will ship the product on time and that the goods will be as their agreement because it creates a lot of risk factors for the importers.
• Wakala Consignment Basis Payment (for Export) : - It is a transaction method in which the local exporter (a consignor) exports the goods to the foreign importer (a trustee) who pays (remit) the exporter only as and when the goods are sold.

Mobile and SMS banking allow you to conduct financial transaction using a mobile device like mobile phone or tablet via mobile banking Apps.

Perform online banking using your smart phone or other mobile devices.

Services available:-

• Checking balance
• Bill payment
• Fund transfer
• Mobile text and alert …

Bank anywhere at any time.

The Mobile Banking services that will come soon will enable you to access your bank accounts,make fund transfers,payments and balance inquiries as well as get instant notifications on all your accounts linked with MB.

Using electronic payment system conducts a range of financial transactions through our website.

Execute a bunch of financial transactions at CBO on line via the internet.

CBO online services:-

• Search for balance
• transaction history
• Acquire e-statements
• Order new statements
• Transfer funds
• Pay bills
• Receive bills online

CBO provides ATM card linked to saving / checking account of the customer. CBO card is convenient for your life style.

Let you bank virtually, All the time, 24 hours a day, 7 days a week.

It also enable you perform financial transaction, in a public space through computerized telecom device, point of sale /POS/ machine.

 

• Fast cash withdrawal
• Balance enquiry
• Fund transfer
• Payment …

CBO card allow you to access your account at any ATM and POS machine, in the country.

CBO receives money sent from all over the world through its SWIFT Code CBORETAA and 16 international money transfer agents. The bank delivers foreign remittance on its 250 branches distributed through out the country.

The Trade Service is one of the core processes of the bank entrusted with the task of international banking services.

The services are now provided at all branches of the bank with a single contact point of customer service relationship officers assigned for this purpose only.

The following are major services provided:

Documentary credit (L/C): is a written undertaking by a bank given to the seller at a request and/or the instruction of the buyer to make payment or accept and pay bill of exchanging (draft) drawn by the seller up to a stated sum of money within a prescribed time limit and against stipulated documents.

Import-available by sight payment/negotiation payment/deferred payment*/acceptance payment*

Export-payment available by sight/negotiation/acceptance of bills

*If approved by the National Bank of Ethiopia

Documentary collection: is a method through which banks handle a seller's commercial documents with or without financial documents in accordance with instructions received from the seller in order to deliver the documents to buyer (importer) against payment and/or acceptance or against other terms and conditions.

Import-available by sight payment

Export-available by sight payment/acceptance payment

Advance payment: is a method through which a seller receives payment from a buyer prior to shipment or the agreed upon goods or rendering the agreed upon service.

Import-Payment though bank transfers

Export-Payment through bank transfers, traveler cheques, cash (as long as it is declared).

Consignment basis payment: It is a method of payment in which the title to the goods remains with the seller until an agent (distributor) in foreign country sells them. Payment is made to the seller if and when the agent (distributor) sells the goods.

Export- it is applicable to perishable items: fruits, flowers, meat, molasses, etc as approved by the National Bank of Ethiopia

Guarantee: A letter of guarantee issued by an issuing bank/guarantor is a written undertaking by the bank to compensate (pay sum of money) to the beneficiary (local or foreign) in the event that the obligator/principal fails to fulfill his/her /its obligations in accordance with the terms and conditions of the guarantee.

Types of guarantee:

• Bid bond
• performance bond
• advance payment guarantee
• loan guarantee, retention guarantee
• customs duty guarantee

Franco valuta license(permit): is a license issued to importers of goods on which no foreign exchange is payable.

Small export items license (permit): is a license issued for small export items to tourists, foreign residents of Ethiopian nationals who wish to take souvenir, samples, gifts, repairs, replacements, exhibitions and personal effects and belongingness, etc.

Eligibility criteria/conditions

• Customers that request the above products of Trade Service, except guarantee should fulfill the following criteria:
• Should maintain current account with the bank
• Should be in the possession of valid trade license for import /export as appropriate or business license or investment or industry license or must exist in the list of budgetary government organizations issued by the National Bank of Ethiopia. In case of non-government organization, certificate issued by the Ministry of Justice, Regional Governments and offices authorized by proclamation.

Loans and Advances

Overdraft Facility Allow customers to draw beyond the deposits of their current accounts, for a viable and ongoing business.

Overdrawal

The right to withdraw a specified amount of fund over the Overdraft limit as working capital.

Merchandise Loan Facility

A credit facility provided against merchandise or documentary evidence as a collateral for short term.

Pledge or collateral

• Negotiable warehouse receipt for goods in warehouse
• Original Railway Receipts
• Truck-way bills
• Airway bills

Import Letter of Credit Facility

A facility provided to importers, on payment of a certain percentage of the value of the document while opening a Letter of Credit.

Pre-Shipment Export Credit Facility

A Facility extended for expenses until the time of shipment:

• Purchase of raw materials
• processing
• Warehousing
• Packing and transporting and other

Revolving Export Credit Facility

An advance extended to exporters to bridge their temporary working capital requirement upon presentation of all valid and acceptable export documents, except bill of loading.

Letter of Guarantee Facility

A written promises by the bank as compensation to the beneficiary in the event that the obligor fails to honour his/her/its obligations, in accordance with the terms and conditions of the guarantee/agreement/contract.

Types of Letters of Guarantee rendered:

• Bid Bond
• Performance Bond
• Advance payment Guarantee
• Suppliers’ Credit Guarantee(Trade Credit Guarantee)
• Retention Payment Guarantee
• Customs Duty Guarantee

Import Letter of Credit Settlement Loan

A loan rendered by converting the outstanding import letter of credit document’s value either to a merchandise loan facility or a term loan.

Term Loan

Types of Term Loan

• Short-Term
• Medium-term and
• Long-term

Agricultural Term Loan

A loan rendered for purchase of agricultural inputs and Agricultural Investment.

Motor Vehicle Loan

Loan provided for the purchase of new motor vehicles for borrowers in business sectors.

Construction Machinery Loan

A loan delivered for the purchase of new construction machinery.

Equipment/Machinery Lease Financing

Available for either of the parties to the lessee agreement:

• Equipment/Machinery lease financing for the lessee
• Equipment/Machinery lease financing for the lessor.

General Eligibility Criteria for Loan

All customers applying for any type of loan/facility at CBO must fulfill the following general eligibility criteria:

• All persons engaged in lawful trading activities and creditworthy business(es) is/are eligible to borrow business loans. However, other non-trading institutions will be eligible depending on their nature and strategies without violating any active proclamation or directive.
• The business credit applicant should present renewed trade license for the current fiscal year or investment license and principal registration certificate for new projects.
• All applicants who are engaged in business must present a tax identification number /TIN/ or tax exemption certificate for all of their income.
• The applicant and/or any of its shareholders/subsidiaries shall fully settle any previous loss to the Bank, if any. To this effect, internal records shall be thoroughly checked.
• The applicant must have never been engaged in tax evasion, or in a breach of exchange and control regulations, or in any other illegal/unlawful dealings, if the information is known to the bank/the circulated record is available.
• The applicant must not have any record of mal-operation of the checking account in the banking system until the rehabilitation period is expired.
• The applicant shall fulfil at least the required minimum equity contribution.
• The applicant and/or any of its major shareholders/subsidiaries must not have any non-performing loans in any bank.
• The applicant has to present all the documents/information demanded by the Bank.
• The applicant’s business must be financially viable, legally acceptable, socially desirable, technically feasible and environmental friendly.
• If the applicant is cooperative, it has to provide its legal personality certificate and the last budget years’ audited financial statements, should establish accounting and record keeping systems, employ qualified manpower, and properly drawn business plans to effectively run the business.
• In addition to these criteria, customer has to fulfil the specific eligibility criteria for each loans and advances indicated in the credit product line.