You have traveled the world to find buyers and market your product. You've been to Europe but all they just promised that they might consider ordering from you. You've been to the United States but no American company gave you a clear-cut answer. You've been to Australia and all they said was that they would think about it. Yes, you have traveled the world and what you got were a bunch of promises that they would think about your offer. Its been two years and you didn't receive a single call from any of them. Is that how long these foreigners think these days? Just when you are just about to jump from the top floor of your building, your mobile phone rings. It's a foreign company interested in buying your products. You are so happy but hey, you don't have any more products. You want to produce another set but you have spent all your money on traveling. What are you going to do?
Don't jump from the ledge yet. Apply for “export finance.” Export finance relates directly to export orders or transactions or both. It fills the vacuum between the order and invoice finance. When a foreign customer has given firm commitment to purchase your products but you don't have sufficient funds to buy raw materials for your goods, export finance can solve your problem.
People mistake export finance for “finance for exporting” sometimes. They are two completely different concepts. The latter involves funding a completely new export venture. It provides funds enough to make an existing company move from a business model focusing on domestic markets to an internationally-oriented and export-based model. Export finance, on the other hand, is deal-specific. This means it is not subject to usual banking limits or restrictions.
Banks and other export finance services have their own requirements and criteria in judging whether they will approve your application or not. They usually make sure that you have significant experience in your trade. You have to present proof that there are firm orders in hand. The goods must also be non-perishable and non-controversial. Sometimes, they look for the support of other funders and your ability to pay if something goes wrong.
Export finance is really helpful especially for those who have been starting to conquer the international trade scene. If you already have customers and clients who are really willing to buy your products but you don't have enough funds to produce them, export finance can be the answer to your prayers.
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