Borrowing base facilities and warehouse financing

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This Overview is a guide to the Banking & Finance content within the Trade finance: Borrowing base facilities and warehouse financing subtopic, with links to the appropriate materials.

Structured Trade Finance or Structured Commodity Finance (SCF) is a term used to encompass several different methods of finance for producers and traders of goods and commodities including borrowing base facilities and warehouse financing.

Borrowing base facilities

Borrowing base facilities ('BB Facilities') are a type of trade finance. They are working capital credit facilities designed to provide short term liquidity by way of advances or the issue of trade instruments ('Instruments') such as letters of credit or demand guarantees. They are secured in full by current assets (usually trading receivables, inventory (ie goods in storage or in transit), cash and contractual rights) of the borrower and/or other security providers. To that end, the amount of capital available to the borrower at any moment is directly linked to the value of the assets providing security to the lender(s).

BB Facilities are generally provided to trading companies on a revolving basis for the purposes of purchasing,

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