Trade finance, or trade loans, are short-term credit facilities indexed to a business’s import and export transactions. Trading businesses in all sectors can take advantage of trade finance, whether they conduct trade based on credit, direct transactions, collections or customer accounts. Businesses trading in services can also access trade finance.
Credit can be used to finance any business purpose, but is normally acquired to facilitating further trade – acquiring goods, financing infrastructure etc.
Why Choose Trade Finance through Business Finance Solutions (UK) Ltd?
Some trading sectors find it difficult to acquire traditional credit and short-term loans due to the perceived risks. Trade finance is a cost effective and convenient alternative for businesses with an established sales ledger and trading history.
- Increase your competitiveness by using trade finance to extend credit to your customers and suppliers
- Improve cash flow and business liquidity
- Reduce trading risk
At Business Finance Solutions (UK) Ltd we work with a range of banks, institutions, and private finance providers to acquire the best deals for your industry and needs. As trade finance is linked to your past and prospective performance, you need a finance provider that understands the risks and opportunities associated with your industry.
Types of Trade Finance
Trade finance is a blanket term that covers several different lending arrangements. These include:
- Letters of credit
- Export credit
Trade finance factoring involves a business selling its invoices (i.e. Accounts Receivable) to a factoring company in exchange for a cash advance. Please see our main page on factoring for further information.
Credit letters are issued by banks and other lenders to underwrite a buyer’s payment to a specific supplier which allows for trading companies to extend their purchasing power and take advantage of market opportunities. A letter of credit may cover the full or partial amount required for the purchase.
Find Out More
For more information, please speak with one of our advisers today by calling 0345 50 50 888.