Secure and Flexible Finance Solutions
Integrated Wholesale Funding Agreement (IWFA)
The Integrated Wholesale Funding Agreement (IWFA) is a secured lending structure that enables the Borrower to lend based on pre-agreed terms. This arrangement offers the Borrower an opportunity to drive additional growth by transitioning away from conventional structures such as Block Discounting or Revolving Credit Facilities. The meticulously designed solution aims to facilitate expansion while ensuring secure lending practices.
Financial Flexibility: Mastering the IWFA for Advanced Lending Solutions
An IWFA is a unique financing solution where the Borrower or a Special Purpose Vehicle (SPV) can fund lending at a 100% advance rate. Conister Bank will hold legal title and equitable benefit by “looking through” to the underlying agreements. The Borrower takes full responsibility for service loans including originating, on-boarding, administering, collections, and enforcement.
In an Integrated Wholesale Funding Agreement (IWFA), Conister Bank manages security by taking a debenture over the Special Purpose Vehicle (SPV), imposing a share charge over its assets, and securing the arrangement through the IWFA. Additionally, a collection account is established for handling customer receipts, with Conister Bank either serving as a signatory or directly owning the account. This approach ensures that the agreements are well-secured and that Conister Bank maintains control over the flow of funds.
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FAQs
What responsibilities does the borrower have in servicing the loans under the IWFA?
The Borrower is fully responsible for servicing the agreement, including origination, onboarding, administration, collections, and enforcement. This includes managing all customer queries and complaints. A standby servicer is appointed, and a tripartite agreement including Conister Bank is signed before the Facility goes live.
What are the financial covenants in the IWFA?
In the Integrated Wholesale Funding Agreement (IWFA), financial covenants include the facility security ratio, tangible net worth, and interest cover. These covenants are established based on the borrower's historical and forecasted performance to ensure financial stability and compliance. Conister Bank actively monitors adherence to these covenants throughout the life of the Facility to manage risk and maintain financial health.
What documents and conditions are required for the IWFA?
The Borrower must provide a range of legal documents to satisfy conditions precedent and achieve legal completion. These documents include:
- Anti-Money Laundering (AML) and Customer Due Diligence (CDD) identification documents to verify the borrower's identity.
- Valid proof of address documentation.
Additionally, the following conditions may be required:
- Agreements with Software as a Service (SaaS) and Systems, Underwriting, and Networking (SUN) providers.
- Any other necessary legal documents as stipulated by Conister Bank.
These requirements ensure compliance with regulatory standards and the secure execution of the Integrated Wholesale Funding Agreement.
What is the buyback obligation in the IWFA?
Under the terms of the IWFA, the borrower is required to buy back any loans that reach 90 days in arrears or fail to meet the agreed-upon Eligibility Criteria.