Types of trade finance

Types of trade finance guidance:

Bills of exchange are negotiable instruments that represent an unconditional promise by one party to pay another party, in accordance with the terms of that instrument....

Practice Note

What is a borrowing base facility? Borrowing base facilities ('BB Facilities') are a type of trade finance. They are working capital credit facilities which are secured...

Practice Note

Commercial letters of credit (also known as traditional letters of credit or L/Cs) are used in relation to the movement of goods in the context of international or...

Practice Note

Standby letters of credit are a type of letter of credit. The common feature of all letters of credit is an undertaking by a bank to pay the beneficiary of the letter of...

Practice Note

Commodity repurchases (repos) are an increasingly popular alternative method of financing. There are a number of advantages for both the financier and the trader in...

Practice Note

BREXIT: The UK is leaving the EU on Exit Day (as defined in the European Union (Withdrawal) Act 2018). This will have an impact on the information in this Practice Note...

Practice Note

Introduction What is trade finance? The term 'trade finance' is used to cover a number of different forms of financing and methods of payment, from secured syndicated...

Practice Note

The popularity of financing business through the invoice discounting and factoring of receivables has grown significantly in the UK over the last 25 years. Invoice...

Practice Note

This Practice Note deals with on demand guarantees and bonds. (It does not deal with conditional guarantees and bonds which are usually provided by insurance companies...

Practice Note

What is pre-export finance (PXF)? PXF is an established structure used to provide finance to producers of goods and commodities. It is a type of trade finance. PXF...

Practice Note

What is prepayment finance? Buyers frequently provide finance facilities to commodity producers by way of paying in advance for goods and commodities. Prepayment finance...

Practice Note

A promissory note is a type of bill of exchange (for more information, see Practice Note: Bills of exchange—structure and parties) and accordingly governed by detailed...

Practice Note

BREXIT: The UK is leaving the EU on Exit Day (as defined in the European Union (Withdrawal) Act 2018). This may have an impact on the aspects of this Practice Note that...

Practice Note

What is it? Structured trade finance or structured commodity finance transactions are generally loan facilities under which funds are applied to produce, store,...

Practice Note

The Basel regime—overview of Basel III In December 2010, the Basel Committee on Banking Supervision (BCBS) published: • 'Basel III: A global regulatory framework for more...

Practice Note