An introduction to Trade Finance
Trade finance is the term widely employed to encompass the various forms of funding available to facilitate international trade and commerce, covering both the import and export of goods and services. Trade finance products can aid in lessening or mitigating the risks associated with international trading. Whether you are exporting or importing goods, trade finance can assist in ensuring that the business supplying the items receives payment, and conversely, that the customer receives the required quality and quantity of items.
Letter of Credit
At its simplest, a Letter of Credit – also known as a Supplier Undertaking – is a commitment issued by a bank on behalf of an importing client to make a payment within an agreed timeframe, provided the goods supplied meet specific terms and conditions (usually concerning quality and quantity). A Letter of Credit minimises the risk of non-payment and resolves the complexities of arranging a foreign currency transaction.
Bonds, Guarantees and Indemnities
These types of trade finance products exhibit a definitive financial commitment to deliver goods or services as per agreed terms and a company’s financial reliability. Available for the duration of a contract, bonds and guarantees can be issued in a buyer’s local currency, streamlining transactions and enhancing a company’s capacity to negotiate a favourable deal.
Trade Loan
A trade loan can assist a business in financing regular or one-off purchases over the short or long term. Bridging the gap between orders and payments, a trade loan can be customised to align with a business’ trading cycle and often reduce overall borrowing costs. By extending your overdraft facility with a trade loan, you may increase borrowing capacity and alleviate pressure on your business’ cashflow.
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Asset Backed Lending
When exploring avenues to finance a business, the solution often resides within the company’s balance sheet, where capital is tied up in various assets. Approaches such as asset-based lending (ABL) offer businesses the opportunity to unlock these resources to fuel expansion or address day-to-day cash flow needs.
Business Loans
Bespoke short or long-term growth capital solutions for established businesses that are going through significant strategic milestones or events.
Trade Finance
Grow your business overseas with export sales in new markets, or save on equipment and stock by importing direct. We’ll help you navigate specialist trade finance to reduce risk and maintain cashflow.
Management Buy Outs/Ins (MBO/MBIs)
Completing a Management of Leveraged Buy Out is a delicate process. We work with experienced teams on the correct funding solutions for the succession of the business.
Renewables
The correct renewable investment can lower your operational costs and diversify your revenue streams. Our funding solutions minimize upfront capital outlay and accelerate ROI.
Debt Consolidation
Restructuring current debt facilities to enhance the capital structure, optimise pricing, prolong maturities, and facilitate recapitalisations.
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