Import finance helps a buyer fund goods purchased from an overseas supplier between order placement and the eventual sale or use of those goods. Banks and other providers may finance letters of credit, supplier invoices, trust receipts, inventory or short-term import loans.
How does Import Finance work in practice?
Import finance can fund the purchase, shipment or holding of goods acquired from an overseas supplier. The bank or provider links the facility to the purchase contract, trade documents, inventory or resulting payable and sets conditions for release. The importer repays under the agreed tenor, often from sales proceeds or ordinary operating cash flow.
What records support Import Finance?
Retain the purchase order, supplier invoice, shipping documents, customs records, financing drawdown, repayment date and landed-cost calculation.
What does Import Finance not establish?
Financing the purchase does not fix weak specifications, shipment delays or customs issues. The buyer still carries the commercial consequences.
