Seller's credit, also called "goods credit", is a loan provided by the exporter's bank to the exporter. In international trade, the export of complete sets of equipment generally adopts deferred payment, and it takes 4-8 years for the exporter to recover all the payment. In order to solve the problem that a large amount of money needs to be paid in advance after production, exporters apply for loans from banks before accepting orders. The exporter signs a loan contract with the bank. The importer only needs to pay 15-20% of the contract amount as a deposit when placing an order, and the rest of the loan will be repaid after delivery or production. Due to the fierce competition in the international market, the seller's credit to the buyer can facilitate the transaction, and the buyer's access to credit can accelerate its capital turnover; The credit provided by the seller to the buyer is based on loans from banks or government financial institutions, so it is also conducive to his capital turnover. In this credit relationship, there is a commercial credit relationship between the seller and the buyer, and a bank credit relationship between the seller and the bank or government financial institution. In order to expand the export of goods, the government of the exporting country usually provides guarantees for such loans issued by commercial banks.

1. The procedures and practices for exporting seller's credit are:

(1) The exporter (seller) sells large mechanical equipment or complete sets of equipment to the importer (buyer) by deferred payment or credit sale. Under this trade mode, after the importer and the exporter sign the contract, the importer pays a deposit of 10% ~ 15% first; When the acceptance and guarantee for partial delivery expires, the payment of 10% ~ 15% shall be paid in installments, and the remaining 70% ~ 80% of the payment shall be repaid in installments within several years after full delivery (generally once every six months), and interest shall be paid during the deferred payment period.

(2) Exporters (sellers) borrow money from local banks and sign loan agreements to raise funds.

(3) After the importer (buyer) repays the interest to the exporter (seller) in installments, the exporter will use it to repay the loan obtained from the bank according to the loan agreement. When the exporter borrows the seller's credit from the bank, he must pay interest at the export credit rate, as well as credit insurance premium, commitment fee and management fee. These costs are added to the export price of complete sets of equipment, but the importer does not know the specific amount of each cost. Therefore, the price of deferred payment is generally higher than that of cash payment, sometimes 3% ~ 4% higher, and some even 8% ~ 10% higher.

Two. Application conditions

1. The borrowing enterprise has normal operation and management, good financial credit status, ability to perform export contracts, ability to implement reliable repayment guarantee and open an account with China Bank;

2. The export project conforms to the relevant national policies and the legitimate business scope of the enterprise, and has been approved by the relevant departments and has a valid contract;

3. The export project has good economic benefits, reasonable exchange costs and the implementation of various supporting conditions;

4. The commercial terms of this contract shall be approved by the Bank of China before signing this contract;

5. The importer has a reliable reputation and can provide foreign bank payment guarantee or other payment guarantee recognized by China Bank;

6. In principle, export contracts should be covered by export credit insurance;

7. In principle, the borrowing enterprise shall provide repayment guarantee recognized by China Bank;

8. When a borrower applies for a foreign exchange loan, it must implement the corresponding sources of foreign exchange repayment.

legal ground

Detailed Rules for the Implementation of The Export-Import Bank of China Export Seller's Credit Project Review (Provisional)

Article 5 The evaluation of export sellers' credit projects shall be undertaken by the export credit project evaluation department established by the project evaluation department. The export credit project evaluation office and the relevant business offices of the credit department should cooperate with each other to improve the service level on the premise of ensuring the safety of credit funds.