Trade financing means that in commodity trading, banks use structured short-term financing tools to finance assets (such as crude oil, metals and grains) in commodity trading. The borrower in trade financing has no other production and business activities except the income from commodity sales, no substantial assets on the balance sheet and no independent repayment ability. Trade financing factoring provides trade financing without recourse, which is convenient and simple, and basically solves the problems of exporters selling on credit and taking up short-term funds on the way.
Trade financing is a service provided by commercial banks, aiming at promoting import and export business between countries and enterprises. The difference between exports and imports is a country's trade surplus.
Its performance is as follows:
(1) Import draft. Refers to the issuing bank after receiving the documents under the letter of credit and checking them, according to
Minsheng launched three new products of trade financing.
The import bill agreement signed with the applicant and the trust receipt submitted by the applicant shall be paid and released in advance. The applicant will return the principal and interest of the draft to the issuing bank after taking delivery with the voucher and selling it in the market.
(2) Overdraft within the limit. Refers to the bank according to the customer's credit status and mortgage (pledge), guarantee, in its bank account for customers to approve an overdraft limit, allowing customers to overdraw within the limit according to the capital demand, and can automatically reduce the overdraft balance with the sales revenue in normal operation.
(3) Import payment. It means that the issuing bank, according to the financing agreement signed with foreign banks (mainly its overseas branches), signs the Payment Agreement under Import Letter of Credit with the applicant before opening the letter of credit, and then submits the documents to the unit with the trust receipt submitted by the applicant, and then telegraphs the foreign bank for payment. The applicant pays the principal and interest paid by the agent on the due date.
(4) False usance letters of credit. It refers to the financing method that the issuing bank stipulates that the draft is forward, the issuing/paying bank pays at sight, and the discount fee is borne by the issuing applicant.
(5) Export bill of lading. It refers to the financing method that the exporter who adopts the collection settlement method entrusts the bank to collect money from the importer after submitting the documents, and at the same time requires the collection bank to advance part or all of the payment in advance, and return the advance payment from the bank after receiving the collection payment.
(6) Export factoring. It refers to the financing method that the bank provides the exporter with funds not exceeding 80% of the invoice amount in advance when delivering the goods, and after obtaining the credit line of the import factor, submits the invoice and related documents to the export factor (bank) to collect the money on his behalf.
(7) Import collection document. It means that after receiving the full set of collection documents sent by the exporter through the collecting bank, the collecting bank will pay the bills first, and the importer will pick up the goods with the documents, and return the after-sales payment to the collecting bank according to the negotiation application submitted by the importer, the trust receipt and the import collection negotiation agreement signed between the collecting bank and the importer.