Trade Finance
Trade Finance
Here’s how it works, why it matters, and how to access it — even without a bank relationship.
What Is Trade Finance?
Trade finance refers to the set of financial tools used to enable and secure international trade. It includes instruments like letters of credit, guarantees, and payment terms that reduce risk and unlock liquidity for both buyers and sellers.
Why Trade Finance Exists
Cross-border trade involves complex risks — currency, timing, credit, logistics. Sellers want to get paid before shipping. Buyers want to pay after delivery. Trade finance bridges that gap, ensuring both sides move without friction.
Who Uses Trade Finance?
- Importers who need time to pay but can’t afford advance payments
- Exporters who want confirmed payment before goods leave port
- Commodity traders managing back-to-back or triangular supply chains
- Project developers importing EPC contracts or machinery
- Private capital providers deploying structured credit through LCs and guarantees
Common Trade Finance Instruments
- Documentary Letter of Credit (DLC) — Guarantees payment once conditions are met
- Standby Letter of Credit (SBLC) — Used as a fallback payment mechanism
- UPAS LC — Pays suppliers at sight while buyer pays later
- Bank Guarantee — Used to secure performance or repayment
- Performance Bond — Ensures a supplier fulfills their contract terms
- Forfaiting — Converts future receivables into upfront capital
How Trade Finance Works
- Buyer and seller agree on trade terms
- Buyer arranges a letter of credit or guarantee
- Seller ships goods and submits documents
- Bank verifies documents and issues payment
- Buyer repays under agreed terms
What Are the Benefits?
- Risk mitigation: Secure payments and guaranteed delivery
- Liquidity: Working capital is freed up through structured credit
- Trust: Enables new relationships between buyers and sellers
- Global reach: You can trade confidently across any border
Challenges in Trade Finance
- Complex documentation and compliance requirements
- Fraud risk in transactions and documentation
- Access barriers for SMEs and firms in frontier markets
- Mismatch between supplier timelines and buyer payment terms
How to Access Trade Finance in 2024
You don’t need to be a long-time corporate client to access trade finance. Platforms like Financely help businesses issue LCs and guarantees through top-tier global banks in 72 hours or less. Explore how we structure trade finance deals here: https://www.financely-group.com/trade-finance-transaction-structuring
Further Reading and Authoritative Resources
- iccwbo.org : Sets global trade rules, including UCP 600 for LCs and Incoterms.
- wto.org : Oversees global trade agreements and customs processes.
- ifc.org : Supports trade in emerging markets with guarantees and credit lines.
- swift.com : Enables secure messaging for LC issuance and confirmation.
- hsbc.com : A major global LC provider supporting multinational trade.
- sc.com : Standard Chartered issues sustainable trade finance instruments worldwide.
- itfa.org : Advocates for risk distribution and structured trade finance techniques.
- forfaiting.com : Provides non-recourse financing for global receivables.
- trafigura.com : One of the world’s largest commodity traders, pioneers in structured trade finance.
Need Trade Finance for a Deal?
We help importers, exporters, and project sponsors secure letters of credit, bank guarantees, and trade instruments — structured and issued in as little as 72 hours.
Submit Your Deal Book a 1:1 CallTrade Finance Is the Backbone of Global Business
From machinery and energy to grain and steel — trade finance makes the global economy move. It reduces friction, manages risk, and unlocks working capital across borders. At Financely, we make it fast, accessible, and structured for serious operators. Let’s fund your next transaction.
Get Started With Us
Submit Your Deal & Receive a Proposal Within 1-3 Working Days
Submit your deal using our secure intake form, and receive a quote within 1-3 business days. Existing clients can connect with their relationship manager through our secure web portal.
All submissions are
promptly reviewed, and all communications are conducted through the intake form or the client portal for a seamless and secure process.
Thank you for considering working with us. A nominal fee of US$500 is required upon completion of each form. This fee covers the time and effort we invest in reviewing your submission and crafting a thorough proposal. We receive numerous inquiries and prioritize those that carry this fee, ensuring serious applicants receive prompt attention.
Trade Finance
Tap into solutions like letters of credit, bank guarantees, and payment facilitation. We address the challenge of global transaction risk through structured strategies that foster cross-border growth. Complete the form to unlock streamlined funding aligned with your commercial objectives.
Submit a RequestProject Finance
Access non-recourse funding for infrastructure, renewable energy, or other capital-intensive ventures. We mitigate capital constraints by isolating project assets and focusing on risk management. Provide your details to receive a structure that drives growth and maximizes returns.
Submit a RequestAcquisitions
Secure financing for business or real estate acquisitions. We ease transaction hurdles by reviewing cash flow, synergy opportunities, and exit plans. Complete the form for a customized proposal that supports your strategic investment objectives.
Submit a RequestFor Banks
Financely assists banks facing Basel III pressures by distributing trade finance deals and providing collateral for letters of credit. We reduce capital burdens while preserving client relationships and fostering service expansion. Submit your request to optimize your trade finance offerings.
Submit a RequestOnce we receive your submission, our team will review your information to determine feasibility. If eligible, you will receive a proposal or term sheet within 1–3 business days. Visit our FAQ and Procedure pages for more information.
Disclaimer: Financely provides financing based on due diligence and feasibility. Approval is not guaranteed, and past performance does not predict future outcomes. All terms are subject to review. Financely primarily assists with structuring and distribution. Qualified parties carry out the project if the client approves the proposal.
