Work Order Financing in banking sector , কিভাবে ব্যাংকিং এর ক্ষেত্রে ওয়ার্ক অর্ডার ফাইন্যান্স করবেন

A work order is a request for a given task to be completed that’s formally submitted to a business or service by a customer, or created in-house within an organization for a job to be done. Work orders are typically created for service technicians, maintenance, or inspection, but can apply to any task that must be completed by or within an organization.
Work Order Financing/Supply Order Financing:
Work Order financing is a set of financing modes allowed to the contractors to participate in tenders of different authorities and to execute their awarded works. The following types of facilities fall under this category -
SOD (Earnest Money)
Under this, Bank Guarantee or undertaking is issued by the Bank in the form of PO on behalf of customers (mostly contractors) to enable to submit bid in a tender invited by different Government/ Semi-Govt. Organizations, Autonomous Bodies or other organizations acceptable to the Bank.
Bid-Bond Guarantee
Under this, Bank Guarantee or undertaking issued by the Bank on behalf of its customers (mostly contractors) to enable to submit bid in a tender invited by different Government/ Semi-Govt. Organizations, autonomous bodies or other organizations acceptable to the Bank.
Performance Guarantee (PG)
A Performance Guarantee is given after the tender or bid of a particular customer is accepted by the authority. It is a Guarantee where the Bank gives an undertaking to the authority that the customer will complete the job as per terms of the tender or to pay damage up to the Guarantee amount.
Advance Payment Guarantee (APG)
This facility is a kind of Bank Guarantee or undertaking issued by the Bank on behalf of customers (mostly contractors) to enable to receive payment in advance against the work awarded by different Government/ Semi-Govt. Organizations, Autonomous Bodies or other organizations accepted to the Bank. This sort of Guarantee is needed, when the work involves initial cost like Advance Rent Payment regarding rental of machinery and procurement cost of raw materials etc.
OD [Work Order/Supply Order]
This is a funded credit facility sanctioned to meet working capital requirement enabling the contractor for execution of work orders/supply orders awarded by different Government/ Semi-Govt. Organizations, Autonomous Bodies or other organizations accepted to the Bank. The amount of loan is disbursed upto a certain percentage of work order/supply order value.
Retention Money Guarantee
Retention Money is a Bank Guarantee issued by the Bank on behalf of the contractors enabling the customer to release money retained from the work awarding authority which were deducted by work awarding authority from bills during work execution period.
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[@mdmazid3293]

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[@bankingknowledgebd]

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[@mohammadmehdihasan7779]

ধন্যবাদ

[@bankingknowledgebd]

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[@rupaakter551]

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[@bankingknowledgebd]

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[@bankingknowledgebd]

Thank You for your valuable comments brother.

[@martinneralla3511]

Can u pls tell some banks which offer this facility?

[@bankingknowledgebd]

NRBC, Jamuna, Standard Bank like many banks are providing this.

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[@bankingknowledgebd]

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[@khanrehan5483]

স্যার আসসালামু আলাইকুম
ওয়ার্ক অর্ডার ফিন্যান্স সকল ফরমেট কি পাওয়া যাবে

[@bankingknowledgebd]

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[@Mushfeq.]

Many thanx for sharing such risk factors what I personally is not addressed properly. However, I need to know some more things that is... how will we minimize the risk factor other than giving Liquidity Assest or Commitment Certificate, (if the Div. asked for) and those contractors have no ability of such liquidity...?
If we take collateral security from that client, can we issue commitment certificate, if we take collateral security as land....?
Wish your personal opinion in order minimize such risks as well as to retain that client.

[@bankingknowledgebd]

You should obtain permission from HO/CRM along with your TL PO approval then it would be best practice for your organization. For that, you have to ask permission along with your loan proposal. If you have mortgaged then you have to take permission form HO seperately or with composite limit. If your management doesn't allow then you should not do this type of business but the client arrange it (TK) for liquid asset for that particular day personally from his own sources or from other sources then you can provide liquid asset but for commitment certificate you must have approval form MGT. Thanks for your query.

[@Mushfeq.]

@@bankingknowledgebd Thanx also for your reply.
So, main thing is to take approval from management. but, a client can slip anytime due to delay of billing or any other valid reason which may not relates to client's intention. If management changed on that time, many questions would be raised. So, first to know the management longsivity then client. I think you've got my point.(personal opinion)

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[@bankingknowledgebd]

Thanks for your valuable comments

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[@bankingknowledgebd]

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