Uncommitted Facility

Uncommitted Facility

An agreement between a bank and a company or, rarely, an individual to provide an unspecified amount in loans on demand from the borrower. The borrower is under no obligation to actually take out a loan at any particular time. Funds borrowed are not repaid on any particular schedule, but they must be repaid on demand from the bank. This agreement is fairly common in situations where a business must make payroll but does not always have the operating income to do so. See also: Committed facility, Line of credit, Overdraft facility.
References in periodicals archive ?
An MTN programme is an uncommitted facility and any drawdown under this document is subject to funding requirements.
Tiphone also has minimal undrawn committed and uncommitted facility of less than IDR300 billion.
Since a supplier finance facility for discounting account payables is legally an uncommitted facility based on the Buyer's irrevocable payment instructions, the Buyers and Suppliers want relationship banks to be involved to ensure continuity of their business and availability of bank finance irrespective of the market conditions.
The new committed facility replaces an USD1.2bn uncommitted facility that will mature on November 14, 2008.
An EMTN programme is an uncommitted facility and any drawdown thereof under this document will be subject to funding requirements.