Export financing aims to support businesses reaching an international market. Export finance is a method for businesses to release working capital, especially from overseas transactions, that might otherwise be held up in invoices being unpaid for a long period of time. Export finance may be provided by banks, non-bank financial institutions such as factoring companies, and ‘alternative’ finance providers such as invoice finance marketplaces, trade finance funds, and fintech.
One of the many ways to get import financing is by approaching financial institutions like banks and credit unions that offer options including asset-backed loans, regular loans, business credit cards, and overdrafts.
Features of Export in Trade
Post Shipment Finance is a kind of loan provided by a financial institution to an exporter or seller against a shipment that has already been made. This takes care of cash or liquidity requirements of export business for the time lag between when an exporter ships the goods until he receives the payment from the buyer.
Pre-Shipment Financing covers the working-capital needs of the seller, including procurement of raw materials, labor, packing costs, and other pre-shipment expenses in order to allow the seller to fulfill delivery. Pre-shipment Finance is a loan provided by a finance company to support the seller in running operations in a smooth manner.