Export supply chain finance

One minute guide. What is it? Supply chain finance (or SCF) refers to a funding program implemented by a buyer to provide early payments to his suppliers. It typically works like this: The buyer teams up with one or banks, who

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Basel 3 and trade finance

Five minute guide. What does Basel 3 say about trade finance? Basel 3 requires banks to keep high levels of capital against trade finance including letters of credit that they issue. Many banks are reducing or pulling out of trade finance services as a result. This

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Letter of credit

One minute guide. What is it? A letter of credit ("LC") is a flexible and internationally accepted form of financial guarantee. What it does depends upon what it says. But with that caveat, it is commonly organised to support the trade in goods.

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Documentary collection

One minute guide. What is it? Documentary collection is a system to help exporters. It is used by exporters: to ensure that control of the goods is retained until the exporter is sure that the buyer will pay, and correspondingly,

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Discrepant LCs

One minute guide. What is it? Many exporters ask their buyers to arrange a letter of credit. This is a payment guarantee from the buyer's bank. It is intended to ensure that the exporter can ship the goods and be confident that the buyer will pay for them

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