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Structured trade finance is a type of debt finance that involves a variety of security instruments to finance the trade of different commodities in a closed-end, self-liquidating, secured and closely monitored transaction. It can involve all or part of the following financing stages:
- Advance payment financing: This is a type of financing that is provided to the seller of commodities before the goods are shipped. This can be used to help the seller cover the costs of production or to finance the purchase of raw materials.
- Pre-export financing: This is a type of financing that is provided to the seller of commodities before the goods are exported. This can be used to help the seller cover the costs of transporting the goods to the port of export or to finance the payment of import duties.
- Warehouse financing: This is a type of financing that is provided to the owner of commodities that are stored in a warehouse. This can be used to help the owner cover the costs of storage or to finance the sale of the goods.
- Transit and port financing: This is a type of financing that is provided to the owner of commodities that are in transit or that are stored in a port. This can be used to help the owner cover the costs of transportation or to finance the payment of port fees.
- Bill of lading financing: This is a type of financing that is provided to the holder of a bill of lading. A bill of lading is a document that proves ownership of goods that are being transported. This type of financing can be used to help the holder of the bill of lading cover the costs of transportation or to finance the sale of the goods.
- Receivables financing: This is a type of financing that is provided to the owner of accounts receivable. Accounts receivable are the amounts that customers owe to the seller of goods or services. This type of financing can be used to help the owner of the accounts receivable cover the costs of extending credit to customers or to finance the sale of the accounts receivable.
- Back-to Back L/C Financing (transactional finance)
- Syndicated Short Term Trade Finance
The specific terms and pricing of a structured trade finance arrangement will vary depending on the commodities being traded, profile and needs of the borrower.
Structured trade finance help businesses to finance their operations and to mitigate the risks associated with trade. FIMBank may provide such facilities in all major currencies.
For further details, contact our Trade Finance team on +356 21322100 or send us an email.