What is Trade Finance?

Trade Finance services make trading safer by involving a reliable third party, usually a financial institution, to reduce the risk between buyers and sellers.
These services also help manage cash flow better. Sellers get their money faster, and buyers can extend their credit terms, making trade smoother for everyone involved. Overall, Trade Finance plays a crucial role in making global trade more secure and efficient.
  • Key Eligibility Criteria:
  • Min £200k turnover
  • The business is a limited company
  • Confirmed purchase order
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Benefits at a glance

Risk Mitigation

Trade Finance offers financial guarantees, boosting security for both buyers and sellers.This Assurance significantly reduces the risk of non-payment, fostering trust and confidence in international trade relationships.

Optimising Working Capital

Trade Finance strategically provides funds at different stages of the trade cycle. This approach empowers businesses to effectively manage cash flow, fulfil orders, and readily seize growth opportunities.

Operational Efficiency

The streamlining of trade processes minimises administrative burdens,  allowing businesses to concentrate on core operations and thereby enhance overall productivity.

  • Most common industries:
  • Wholesalers
  • International Traders
  • Exporters & Importers
  • Retailers
  • E-Commerce
  • Manufacturers
  • Construction

Types of Trade Finance

Purchase Order Finance facilitates the fulfilment of specific customer orders by providing funding during the period between receiving purchase order and receiving payment. It helps businesses acquire the necessary inventory or goods to meet customer demand.
Letters of Credit (LCs) are commonly used in international trade. In the arrangement, a financial institution ,representing the importer, issues a letter of credit to the exporter.This Letter guarantees payment upon meeting specified terms and conditions, ensuring secure transactions for both parties.
Supply Chain Finance focuses on optimising cash flow throughout the supply chain. It offers early payment options to suppliers based on approved invoices or receivables, ensuring timely payments and improving working capital for suppliers.
Other Trade Finance products include pre and post shipment financing, inventory financing, and structured Trade Finance. For more information on these options or to find the best fit for your business, please reach out to our experts.

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