Export finance

A cash flow solution for exporters, export finance helps to facilitate the commerce of goods internationally. When a seller agrees on the payment terms of the cross-border buyer, it can create cash flow issues. However, the supplier is still expected to ship the goods overseas knowing they will be paid at a later date. Export finance enables businesses to gain access to their working capital before their clients pay for the products purchased.

Types of export finance

Pre-shipment finance: Provided when exporters need funds before the shipments of products or goods.

Post shipment finance: Provided after the shipment of products.

Finance against collection of bills: In the case of international export, exporters can obtain a loan from the bank against those bills sent for collection.

Finance, gains, allowances and subsidies: Government provides subsidies to the exporters to enable them to sell the goods at a reduced price to importers.

Discounting letter of credit: Consists of security from the issuing bank regarding making payment.

Benefits of export finance

  • Bridge the cash flow gap between paying suppliers and getting paid
  • Minimised risk
  • Release value of outstanding invoices
  • Funding to grow international trading and pursue bigger opportunities