Trade Finance: The Complete Guide

Trade finance is an umbrella term that covers businesses importing and exporting goods. It enables the buying and selling of finished goods by bridging the payment gap between goods shipment and receipt of payment.

Letters of Credit

Used to guarantee secured payment settlements with international trades. It provides a seller with a payment guarantee from the buyer's bank, mitigating risks like non-payment.

Advantages

• Competitive Advantage: Reduces risks of non-payment and territory risks.
• Relationships: Enables quicker supplier payments, often in local currency.
• Growth: Frees up working capital to invest in more orders.