Trade Finance is one of the world’s oldest Financial Products. For centuries, local and global commerce has required a solution to the classic cashflow problem faced by trading businesses; the need for stock to be purchased from suppliers before the funds required to purchase them are available from customers.
Bridging this fundamental shortfall of cash in trading situations forms the basis of what we do for our clients.
Existing forms of Stock Finance work well in situations where the Stock is going straight from supplier to customer, where the Stock requires no modification and where the end customer has placed an order before the stock is despatched from the supplier.
The problem for many businesses is that life is seldom so simple.
Strong demand for a product is not the same as confirmed orders and in many cases the product in question is not supplied in a finished state from the supplier. It is common for trading businesses to need to pay suppliers for goods that are going into stock for a short period, or for stock components that require assembly before being ready for sale. Long-established lending principles rule many classic Trade Finance providers out of providing funds in either of these scenarios.