Trade Finance

We offer the following services under our Trade Finance facility

Post-Import Finance –  This is a loan facility that helps you settle bills of exchange that have matured in cases where you have not mobilized adequate resources to settle the same.

Bills Discounting –  This is done when sales are on credit and secured by accepted bills of exchange where the seller may use these bills to improve their cash flow by discounting the same. ABC Bank provides funds to the customer and waits for reimbursement from the drawees (buyer) of the bill at maturity.

Avalization –  This is when sales are on credit and secured by accepted bills of exchange and the seller still runs the risk of not being paid. To reduce the risk of default, the seller may ask the buyer that the bill of exchange must bear the guarantee of the bank that on due date payment shall be made. The act of the bank adding its commitment to pay on the bill of exchange is called Avalization. It helps the buyer receive goods on credit and gives the seller the comfort of payment. It also allows the seller to discount the avalized bill to create cash flow.

Pre-shipment Finance –  This facility enables the exporter to access funds that will help in preparing the goods ready for export. It is normally supported by a confirmed export order.

Post Export Finance –  This facility enables an exporter to access funds against proceeds expected from goods that have been exported.

Documentary collections –  The seller may develop a level of trust with the buyer to the extent where goods will be shipped to the buyer even before payment has been done. Documents (including transport documents) will then be sent through the banking system.  The seller’s bank will instruct the buyer’s bank to release the documents on fulfilment of some conditions. Documentary collections help the seller to control documents and title to goods while assuring the buyer that the goods have been shipped.

Clean collections –  The presenting bank sends instructions to the collecting bank to collect proceeds and make payment on fulfilment of certain conditions. This allows for cost-effective trade finance transactions.