Trade finance is related to international trade.docVIP

Trade finance is related to international trade.While a seller (the exporter) can require the purchaser (an importer) to prepay for goods shipped, the purchaser (importer) may wish to reduce risk by requiring the seller to document the goods that have been shipped. Banks may assist by providing various forms of support. For example, the importers bank may provide a letter of credit to the exporter (or the exporters bank) providing for payment upon presentation of certain documents, such as a bill of lading. The exporters bank may make a loan (by advancing funds) to the exporter on the basis