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On Demand Loan Agreement for Pakistan

On Demand Loan Agreement Template for Pakistan

A comprehensive lending agreement governed by Pakistani law that establishes the terms and conditions for an on-demand loan facility between a lender and borrower. The agreement incorporates provisions compliant with Pakistani banking regulations, including the Banking Companies Ordinance 1962 and Financial Institutions (Recovery of Finances) Ordinance 2001. It details the loan amount, interest calculations, repayment mechanisms, security arrangements, and the lender's right to demand repayment at any time. The document includes necessary provisions for enforcement under Pakistani law and accommodates both conventional and Islamic banking requirements where applicable.

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On Demand Loan Agreement

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What is a On Demand Loan Agreement?

The On Demand Loan Agreement is a crucial financial instrument used in Pakistani banking and lending operations when a lender provides financing that can be recalled upon demand. This document is particularly relevant in situations requiring flexible financing arrangements where the lender needs to maintain significant control over the loan recall. The agreement must comply with Pakistani banking regulations, including the Banking Companies Ordinance 1962, Contract Act 1872, and relevant State Bank of Pakistan directives. It typically includes comprehensive provisions for loan disbursement, interest calculation, security arrangements, events of default, and enforcement mechanisms. The document can be adapted for both conventional and Islamic banking structures and is commonly used for working capital financing, bridge loans, and other short-term financing needs in the Pakistani market.

What sections should be included in a On Demand Loan Agreement?

1. Parties: Identification of the Lender and Borrower with complete details as required under Pakistani law

2. Background: Context of the loan agreement and relationship between parties

3. Definitions and Interpretation: Definitions of key terms and interpretation clauses

4. The Facility: Details of the loan amount, purpose, and nature of the on-demand facility

5. Conditions Precedent: Conditions that must be satisfied before the loan becomes available

6. Drawdown and Disbursement: Process and requirements for disbursement of the loan

7. Interest and Fees: Interest calculation, rate, and other applicable fees

8. Repayment: Terms of repayment including the on-demand nature of the loan

9. Security: Basic security arrangements for the loan

10. Representations and Warranties: Standard representations and warranties by the borrower

11. Covenants: Positive and negative covenants of the borrower

12. Events of Default: Circumstances constituting default and consequences

13. Demand and Enforcement: Process and circumstances for demanding repayment

14. General Provisions: Standard clauses including notices, amendments, and governing law

15. Execution: Signature blocks and attestation requirements

What sections are optional to include in a On Demand Loan Agreement?

1. Guarantees: Required when there is a personal or corporate guarantor for the loan

2. Additional Security Arrangements: Used when specific assets or complex security structures are involved

3. Insurance: Required when specific insurance coverage is mandatory for the loan

4. Cross Default: Include when the borrower has other significant financial obligations

5. Assignment and Transfer: Include when either party may need to transfer rights under the agreement

6. Syndication: Required for loans that may be syndicated

7. Islamic Banking Provisions: Required when the loan needs to comply with Islamic banking principles

What schedules should be included in a On Demand Loan Agreement?

1. Schedule 1 - Loan Details: Detailed terms of the loan including amount, interest rate, and fees

2. Schedule 2 - Conditions Precedent Documents: List of required documents and conditions to be satisfied

3. Schedule 3 - Security Details: Detailed description of security arrangements and assets

4. Schedule 4 - Drawdown Notice Form: Template for requesting loan disbursement

5. Schedule 5 - Repayment Schedule: If applicable, template or details of repayment structure

6. Schedule 6 - Compliance Certificate: Form for periodic compliance certification by borrower

7. Appendix A - Required Authorizations: List of regulatory and corporate authorizations required

8. Appendix B - Form of Security Documents: Templates or forms for related security documentation

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok成人版 | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Pakistan

Document Type

Loan Agreement

Sector

Banking

Cost

Free to use
Relevant legal definitions







































Clauses






























Relevant Industries

Banking and Financial Services

Commercial Real Estate

Manufacturing

Retail

Technology

Agriculture

Healthcare

Construction

Energy

Transportation and Logistics

Telecommunications

Small and Medium Enterprises

Trading and Distribution

Relevant Teams

Legal

Finance

Credit

Risk Management

Compliance

Treasury

Corporate Banking

Islamic Banking

Operations

Documentation

Relevant Roles

Chief Financial Officer

Finance Director

Legal Counsel

Credit Manager

Risk Manager

Compliance Officer

Banking Relationship Manager

Treasury Manager

Financial Controller

Corporate Banking Officer

Credit Risk Officer

Legal Manager

Company Secretary

Finance Manager

Loan Officer

Industries







Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks, 聽Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination, 聽Severance Pay, Governing Law, Entire Agreemen

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