Why should I consider trade finance for my business?

Trade finance is likely to work for your business for many reasons and we will work hard to find you a lender who will be able to offer your business:

• Strong cash flow – Trade finance can help you to improve your cash flow by providing funding between you paying your supplier and you being paid by your customer. This allows you to tender for new business and start work on new orders, as cash isn’t tied up which can help improve supplier relationships, possibly allowing you to secure early settlement discounts.
• Confidence – Steady cash flow can demonstrate your liquidity to suppliers, encouraging them to do business with you. Specialist hedging products can offer you protection against currency fluctuations and when combined with other insurance products, it can reduce the risk of importing and exporting, giving your business the confidence to expand.
• Accessibility – This can be ideal if your business does not have the financial track record or security to negotiate sufficient overdraft facilities or get credit from your suppliers; this can often be vital for new or growing businesses.
• Flexibility – Trade finance can free up existing lines of credit for other business purposes. When using these facilities it is often possible for you to repay bank facilities and release previously pledged security. Some providers may also be prepared to provide finance against other assets, or even unsecured loans, as part of packaged solution.
• Management time – Using trade and invoice finance facilities in conjunction, can free up valuable management time as it allows you to pass the paperwork involved in paying the supplier to your funder (including raising letters of credit) providing you with a cost effective solution for outsourcing your purchase ledger management.

Are there any risks associated with trade finance?

• International markets and currency – Trading internationally can be risky business as it is a very complex area consisting of many businesses, sectors, languages and currencies. It can sometimes be difficult to keep up with the changing international markets and currency fluctuations which can make international trade complicated and problematic.
• Understanding different cultures – Language barriers are not the only issues. It is important to be aware of different cultures and practices. If you are selling consumer goods you may have to order stock early for Christmas but also you need to be aware of holidays, feasts and customs if you are buying or selling abroad. Fortunately, providers of trade finance, payment transfer services and FOREX services can often provide a wealth of information and specialist advice.
• Maintaining control – You will retain complete control over your sales ledger management.
• Circumstances out of your control – Bad weather, sinking ships, lost cargo or the haulage company going bankrupt can all have an effect on your business and its imports/exports. However, most funders take these sorts of issues into account and offer insurance to protect you and your cash flow should the worst happen so it is worth checking that this is including on your agreement.

Why choose us?

Trading internationally is hard work and keeping on top of invoices and maintaining control of your sales ledger can be a challenge. It’s vitally important to stay on top, so that you can maintain a healthy level of cash flow. If you feel as though trade finance could be beneficial for you and help you trade internationally, or it could give you that extra reach into international markets.

Our years of experience in this sector, means that we are perfectly placed to help you in the process of finding trade finance. Trade finance can be confusing, but our experienced advisors will walk you through every step of the procedure and advise you on what’s best for your business.