Export financing is becoming one of the factors that help businesses take advantage of opportunities to expand their development scope on a global scale. So, what is export financing? Please refer to the article below of SeABank to learn about the concept of this method and how important it is.
What is export finance?
Export Financing is a form of financial support provided by banks to exporting enterprises. The main objective of this type of financing is to promote and support the export process of goods, creating favorable conditions for exporters in the process of expanding their international business scale.
Currently, export financing is divided into the following types:
Based on the form of funding:
- Loan.
- Discount export documents.
- Issue guarantee.
- L/C issuance.
- Other forms of funding according to bank regulations from time to time.
Based on funding stages:
- Financing before delivery.
- Financing after delivery.
Export finance is a form of bank support for businesses.
Characteristics of export finance
The form of export finance will have the following main characteristics:
- Object: Businesses operating in the export sector, facilitating them in the process of international business development.
- Main purpose: Provide finance and support to businesses in the process of purchasing raw materials and producing goods for export, to ensure the quality and quantity of goods to meet international market demand.
- Duration: The term of export finance is flexible and depends on factors such as the implementation and payment time of the Export Contract. This gives businesses and banks more flexibility in setting up payment terms.
- Interest rate: The interest rate of export finance is determined through negotiation between the financial bank. and exporters. This allows flexibility in setting financial terms, while reflecting close cooperation between the parties involved.
Export finance will have the characteristics of trade finance.
Benefits of export finance
Export finance offers many important benefits to businesses that choose this method. Here are some of the key benefits of export finance:
- Meeting capital needs: Export financing helps provide the necessary capital for business production activities of enterprises.
- Improve and manage cash flow: Businesses have access to safe financial sources, thereby being able to manage cash flow and improve operational efficiency.
- Risk Mitigation: Thanks to the bank's project review, business consulting, provision of trade finance policies and support in managing the implementation progress of the plan, the Enterprise can minimize financial risks during business operations.
- Enhance competitive advantage: Having enough capital will help businesses expand production, invest in upgrading infrastructure and developing technology. Thereby helping to increase competitiveness and achieve business goals.
- Enhance market access: The bank provides export support services, creating conditions for businesses to approach international customers, thereby expanding their business network.
Businesses can address their capital needs with export financing.
Learn about SeABank's export financing products
With a variety of products, competitive interest rates and simple procedures, SeABank is currently providing many products related to export financing for businesses nationwide. Let's learn about these products of SeABank right away.
Export financing products at SeABank
Currently, SeABank is providing the following export financing products:
- Pre-shipment financing.
- Post-delivery financing.
- Discount with recourse on export documents.
Export financing conditions
To use export financing products, businesses need to meet the following conditions:
- Enterprises are established, qualified to operate, and conduct legal export business according to Vietnamese law.
- The financial situation of the enterprise must be clear and transparent.
- The purpose of the business's use of the sponsorship is legitimate.
- The business plan of the enterprise is effective and feasible.
Export financing term
The term of export financing at SeABank is flexibly changed based on the type of financing and payment method of the export contract. Accordingly, the maximum term for this product at SeABank can be up to 9 months.
Export financing documents and procedures
SeABank's export financing procedures are very simple, according to regulations from time to time, usually including:
- Legal documents.
- Loan application
- Financial records.
- Collateral profile.
Export financing procedures at SeABank are simple and have quick disbursement time.
Regulations on collateral when financing exports
SeABank accepts a variety of collateral, including:
- Future debt claims arising from Export Contract or L/C
- The right to claim debt is formed from the Export Documents.
- Other types of collateral according to SeABank's regulations from time to time.
Depending on the form of export financing, Customers do not have to provide additional collateral if they meet SeABank's conditions.
Conclude
Hopefully with today's article, you will understand the concept and importance of export financing for the success of businesses in the international market.
If you are an exporting business looking for export financing to improve business performance, please refer to the related products of SeABank. SeABank is one of the leading banks in Vietnam providing diverse export financing products, meeting the needs of exporting businesses of all sizes.
With competitive interest rates, simple procedures, and quick disbursement time, SeABank is committed to accompanying export enterprises on the path of development. To learn more about SeABank's import financing services, please visit the website or contact Hotline 1900.555.587 (Customer Service) or 1900.599.952 (Business Service).
