A good understanding of trade and export finance is critical for importers, exporters and their financiers because risk needs to be managed at every stage of the process of a trade transaction.
Trade finance is designed to assist companies meet cash flow shortages arising from a mismatch in the timing of making payment for goods or raw materials for use in the manufacture of goods, and the receipt of payments from the on selling of these purchased or manufactured goods. How a company assesses and determines its needs and funding requirements are important to take the business to the next step of growth.
Brochure
— Course Fee: RM 1,780.00 (Inclusive of 8% Service Tax) —
Understanding the Role of Financial Institutions to Support International Trade
- Direct and indirect
Trade Financing Facilities
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- Key Issues in Trade Finance
- Trade Finance Tools and Instruments
- Raising Working Capital
- Line of Credit
- Structured Financing
- Export Credit Refinancing – Pre- and Post – Shipment
- Trust Receipt
- Bankers Acceptance
- Bills of Exchange Purchase/Discount
- Selecting Methods of Payment
- Documentary Collection (D/P or D/A)
- Letter of Credit
Methods of Payment: Documentary Collection and Letter of Credit
- Difference between Documentary Collection and Letter of Credit
- What is the value of each instrument?
- The buyer’s perspective
- The seller’s perspective
- When to select the payment instrument
The Documentary Collection
- Parties to a documentary collection
- Types of documentary collection
- Documents against payment
- Documents against acceptance
- The role of banks
- Role and scope of URC522
- Risks associated with Documentary Collections
- Risk to the buyer
- Risk to the seller
The Steps in Documentary Collection
- Diagrammatic process flow
- Fees and cost – Who pays what
The Letter of Credit
- Structure and main features of a Letter of Credit
- Parties to a Letter of Credit
- Legal relationship between parties to a Letter of Credit
- Role and scope of UCP600
- Risks associated with Letter of Credit
- Risks to the applicant
- Risks to the beneficiary
The Steps in Establishing a Letter of Credit
- Diagrammatic process flow of Letter of Credit
- Establishing the Letter of Credit by buyer
- Presenting the documents by the seller
- Fees and cost – Who pays what
How to Reduce Discrepancies in Documentation
- Right Data in the Right Document
- What to Demand in Your Letter of Credit
- What to Avoid in Your Letter of Credit
- Proper Ways to Handle Your Documents
- Create awareness of trade risks in the organization
Other Uses of Letters of Credit to Finance Business Operations
- Back-to-back Letter of Credit
- Transferable Letter of Credit
- Assignment of Proceeds under Letter of Credit
- Red Clause Letter of Credit