Short term export finance Исполнитель

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Short term export finance

However skilled a company is at selling goods overseas and whatever its size, exporting can, because of delays in receiving payment, seriously deplete cash flow and to that extent reduce profitability, unless the exporter arranges special finance. An exporter often has to allow credit terms to an overseas buyer, to cover the time not only needed to transport the goods, but also the period of production, sometimes of years in the case of large-scale projects or heavy machinery exports. In addition, there can be delay between payment by an overseas buyer and the actual receipt of funds by an exporter.

Types of finance. There are two types of export credit. Under supplier credit an exporter allows credit terms to an overseas buyer in the sales contract and then obtains finance to cover these terms from a UK bank. With buyer credit a UK bank provides finance direct to an overseas buyer, or an approved borrowed, so that an exporter can be paid immediately on shipment of the goods. If the finance is with recourse, it means that an exporter is liable for any balance of funds the buyer does not repay to the lender. If the finance is without recourse, an exporter is not responsible to a lender for any default by a buyer.

Shot-term finance. The first obvious method of financing export sales is through an exporting company’s existing overdraft facility with its bank. It is clearly very simply and convenient to finance all the elements of the export contract (purchasing, manufacturing, shipping and credit) by simply overdrawing within the facility and replenishing the account with payments received from an overseas buyer.

As business increases it is unlikely that an exporter can finance sales entirely from an overdraft, particularly as borrowing in this way may be more expensive than other forms specifically designed for export credit.

Advance against bills. One form of short term finance for the exporter is to obtain an advance of funds from a UK bank against the lace value of a bill of exchange drawn by an exporter on an overseas buyer under the terms of the export contract. The exporter sends the bill to the bank which advances an agreed percentage of the value lo the exporter immediately and undertakes to present it to the overseas buyer for collection. If the buyer does not pay the UK bank for the bill then the bank has recourse to the exporter for the loss.

An advance against a bill is made only when unaccompanied by any transport documents relating to the exported goods i.e. it is a clean bill collection. The bank charges interest for the credit period of the loan and fees for the collection operation.

Negotiation of bills. Obtaining an advance against bills is useful only when a limited amount of extra finance is required, the rest being covered by existing resources. If an exporter requires more finance in the short-term, an alternative method is to establish a facility for bill negotiation. The exporter's bank agrees to purchase bills (usually accompanied by the shipping documents) on presentation. The bank may even simply purchase the documents under a cash against documents collection. The bank then sends the bills for collection to the overseas buyer and reimburses itself when the buyer pays. II the buyer defaults, the bank has recourse to the exporter, charging interest for the credit period any collection fees. A cheaper rate of interest is available to exporters holding ECGD (Export Credit Guarantee Department) insurance, and normally the exporter assigns the ECGD policy over to the bank as security.

Acceptance credits. There are various merchant banks, members of the Accepting Houses Committee, which accept a bill of exchange drawn by an exporter on any of its members. This bank bill, as it is called, can be discounted (i.e. sold for its face value less a discount charge) in the money market to one of the discount houses that specialize in this business.

The sale proceeds are credited to the exporter and when the bill matures, the bank pays it and debits the exporter's account for the amount plus an acceptance commission. Alternatively the exporter can draw another bill on the bank to be accepted and simply pay the difference between the face value of the maturing bill and the sale proceeds of the new one. A company can choose when to draw funds by gauging when there is the best discount rate in the money market, instead of being tied to overdraft rates of interest with a bank. Normally only the larger exporter uses this service.

Documentary acceptance credits. With a confirmed irrevocable letter of credit an exporter can receive finance immediately on presenting to the UK confirming bank a bill of exchange and the documents required under the terms of the credit. The bank can accept a term bill for extended periods which the exporter can then discount with any bank for cash. Any cost is charged to the exporter unless it has been arranged for the overseas buyer to bear costs.

Factoring. If export turnover is sufficiently large, an exporter may find it easier to shift the problems of collecting the payment for completed orders over to organizations that specialize in the task of debt collection and trade finance.

An exporter can sell trade debts to a factoring company, usually a subsidiary of a major clearing bank. In return the exporter receives up to 80 per cent of the face value of the debts. The factoring company handles the sales accounting and carries out the task of collecting the debts from overseas buyers.

The factoring company regularly monitors sales ledgers for the exporter. When the factoring company receives payment it credits the exporter with the 20 percent balance, deducting an amount for service charges.

If the overseas buyer defaults on a debt, there is no recourse to the exporter. The factoring company still pays the remaining 20 per cent, less charges, on the due date. Because of this a factoring company makes an agreement with an exporting company only after examining closely the standing of the company and the reliability of an overseas buyer, and indeed of the buyer's country.

A factoring company may be prepared to buy the goods destined for an overseas buyer for cash. The exporter then acts as the factor's agent, delivering the goods and collecting the proceeds.

If the buyer does not know that the exporter has raised finance through a factoring house to export the goods, it is called undisclosed factoring. The exporter still deals directly with the buyer for payment of debts.

To deplete - исчерпать, истощать - тугатмок, сарфлаб тугатмок

To allow credit - предоставить кредит - кредит бермок

With/without recourse - c/без использования(регресс) - ишлатиб, ишлатмасдан

Overdraft - превышение кредита, задолженность банку - кредитнинг ошиш, банкка карздор булмок.

Overdrawing - превышение кредита в банке - кредитни банкда ошиб етиши

Advance - аванс, ссуда - аванс, карз

Face value of the bill - номинальная стоимость векселя - векселнинг номинал киймати

Clean bill for collection - чистый вексель - соф вексел

Bill negotiation - продажа, учет векселя - сотув, векселни хисобга олиш

Cassh against documents - платить наличными деньгами против документов - хужжатларсиз накд пул тулаш

Charging interests - проценты по займам - карзлар буйича фоизлар

Collection fees - сбор штрафов, долгов, взносов - жарима, карзлар, бадал-туловлар йигими