Export Packing Credit (EPaC)

Provides up to 85% of the project cost

Introduction

EPaC is a short-term loan facility designed to help exporters meet the costs of fulfilling confirmed export orders. It provides working capital for pre-shipment activities such as raw material procurement, wages for production staff, packaging, transportation, and branding.

The facility covers up to 85% of total pre-shipment costs, enabling businesses to maintain production timelines and meet buyer expectations without cash flow constraints. Available to both established and emerging exporters with confirmed contracts or purchase orders, EPaC offers flexible terms aligned with production and shipping schedules.

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Key Requirements

To access EDF services under this product, applicants must meet the following general criteria:

  • Registered Entity: Applicant must be a legally registered business in Malawi.

  • Export Commitment: The business must demonstrate confirmed export orders or contracts.

  • Owner’s Contribution: At least 15% of the total project cost must be provided by the applicant.

  • Collateral: Assets, guarantees, or stock to secure the financing.

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Eligibility & Application Requirements

Linking Farmers to Global Markets Through Innovative Financing and Partnerships

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Qualifying/ Eligible Entities

  • Malawian based and/or owned entity registered under the company  Act 2013.
  • must demonstrate that at least 30 per cent of goods or services produced are exported or are destined for export.

Qualifying Instruments

Direct advances as follows:

  • to the Borrower and/or the Borrower’s suppliers of raw materials/intermediate products and other inputs;
  • to the Borrower to meet working capital requirements including salaries/wages/ utility bills etc.; and
  • to the Borrower or third party service providers for meeting costs such as transport/shipping/handling etc.

Lines of Credit as follows:

  • Short-term Line of Credit extended by EDF to intermediary financial institutions.
  • Refinancing of pre-shipment export finance facilities already extended by financial institutions.

  Tenor and Final Maturity

  • Tenors of up to 360 days for the facility’s transactions with simple trade cycles and up to 24 months for complex export transactions

  Sources of Repayment

  • Export Packing Credit Facility exposures will be paid off from:
    • export proceeds assigned to the Fund under an LC or other trade instrument; and
    • For EPC Lines of Credit, a collection account will be opened through which all export proceeds of sub-borrowers shall be assigned.

Eligible Costs

Preference shall be given to costs related to the following export value chain processes:

  • Procurement of raw materials/ intermediate goods and/or other inputs;
  • Manufacturing process or other forms of transformation of Malawian goods and/or services;
  • Wages and salaries for production staff;
  • Direct costs including transportation/ shipping/ handling/ insurance etc.; and
  • Packaging and/or branding.

Collateral Arrangements

Collateral for the Facility may include a combination of:

  • Assignment of Export Contracts;
  • Assignment of export proceeds and/or cash flows from the Exporter;
  • Promissory Notes issued by Financial Institutions obtaining Export Packing Credit Facility’s Lines of Credit;
  • Charge over Collection Accounts; and
  • Any other collateral as may be mutually agreed between the Fund and the Borrower.

Application Requirements

  • Business/owners profile
  • Nature of business and funding requirements.
  • Audited financial statements for three years.
  • Financial projections
  • A summary of borrowing history and bank references.

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