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Corporate Structured Finance

Corporate Social Responsibility

We as a company would like to offer our teams expertise in Trade Finance to new upcoming trading company’s. By providing them with a Structured Trade Finance Solution.

Our 2020 CSR objective is to create a pool of Trading companies. Who can project values such as,

  • Financial Sustainability.
  • Community Focus.
  • Product Price Competitiveness.
  • Strong Trade Footprints.
  • Encourage Young and Elder Entrepreneur.
  • Women Empowerment.
  • COVID-19 Ready.

As we will progress towards our collective goals. We would be collaborating with Local Community, Government Entities and Financial Bodies.

If you see yourself or your company adding value in achieving our 2020 CSR objective. Please email us on info@londontradecapital.com.

Looking Forward to overcome the COVID-19 Economic Challenge together as one.

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Business Loan

Customer who have a turnover of under £3m. Can also apply now by filling in the application form. Our approval ratio is 8 out of 10 Business Loans. Whether you are Local or International Customers. We understand your needs when it comes to trade finance support or a sudden need for the cash-flow situation. Our core value is customers satisfaction. So do not hesitate to contact us, if you need any information or assistance. We offer tailor-made Business loan packages. Our approval criteria differ from customers to customer.

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Reasons for Invoice Finance / Factoring

It is estimated that over 80% of world trade is conducted on open account terms.

As such, sellers may require financing for all or part of their needs.

  • Settlement by means of factoring can be defined and included within the buyer/seller contract.
  • Financing can be arranged at any time during the lifetime of a transaction.

What criteria may lead to an exporter considering factoring?

  • Pressure on cash flow due to increased demand for products.
  • Delays in receiving the settlement of invoices, despite often offering 30 or 60-day payment terms to buyers.
  • Instead of securing a bank loan for a fixed amount, factoring has no limits and factoring is not a loan.
  • The seller may be relatively new to exporting and, therefore, has no prior credit or performance history. However, clients of the company may have long payment histories and good credit scores.
  • Limited resources are available to monitor and chase for payment of invoices.
  • Use the information available from the factor to assess and search for new clients.

For further information, you can email us on info@londontradecapital.com

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Selective Invoice Finance / Factoring

Different Types of Factoring / Invoice Finance options available.

Import Factoring:A service rendered by the Import Factor who provides buyer risk coverage to 100 % within approved revolving credit limits and collection service to the Export Factor. The Export Factor assigns the invoices of its clients to the Import Factor who becomes the legal owner of the receivables. 
Export Factoring:The Export Factor purchases invoices from its client (exporter) to its foreign buyers (importers) and pays 80-90 % in advance based on the buyer risk coverage and collection service provided by the Import Factor. After receipt of the buyer’s payment, the Import Factor immediately remits the full payment to the account of the Export Factor. If the buyer should be unable to pay and the invoice is not claimed or disputed the Import Factor is obliged to pay under approval 90 days after the due date of the invoice. 
Without recourse factoring:The Import Factor covers the risk of bad debts or insolvency of buyers, provided that no valid disputes related to the receivables have been raised. The Import Factors provides credit investigation and credit protection, collection, litigation and ledger management. 
With recourse factoring (Collection-only):The Import Factor covers the risk of bad debts or insolvency of buyers. Between the seller (exporter) and its Export Factor, it has been agreed that the seller shall re-purchase the receivables (if advance payment has been made ) for which the Import Factor was not able to collect the payments. The Import Factor provides ledger management and collections but no debtor risk coverage. Litigation can be done by the Import Factor but the Export Factor/exporter has to bear all costs related to legal action. As part of collection-only, the Export Factor can ask the Import Factor to perform invoice verifications.
Disclosed (notified) Factoring:The Import Factor sends a notification (introductory letter and assignment text suitable for the law of the country where the buyer is located) to the Export Factor who obliges the exporter to inform the buyers (importers) about the assignment of the receivables. The buyers are asked to make payment only to the account of the Import Factor. After receipt of the payment, the Import Factor immediately remits the amount to the account of the Export Factor. 
Undisclosed (non-notified) Factoring:The buyers (importers) are not notified about the assignment of the receivables. Also known as confidential or NNF-Factoring, the buyers continue to pay the invoices directly to its supplier (exporter). The Export Factor informs the Import Factor about every payment received by the exporter. Export and Import Factor have signed a supplemental agreement to the Interfactor Agreement in which a disclosure period of the assignment (usually 30-60 days after due date) has been stipulated.
Islamic Factoring:Islamic international factoring works on the basis of tamleek, exactly like the assignment in usual international factoring, with the only difference of signing the Supplemental Agreement to cover the deviations mentioned earlier. If the export factor is an Islamic one the import factor may sometimes receive an order approval request instead of a credit line depending on which Islamic financial instrument is used as a basis for factoring.

For further information, you can email us on info@londontradecapital.com

Courtesy – https://fci.nl/

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Corporate Factoring Trade Finance

Factoring

WHAT IS FACTORING?

A form of receivables purchase, in which sellers of goods and services sell their receivables (represented by outstanding invoices) at a discount to a finance provider (commonly known as the ‘factor’). 
A key differentiator of factoring is that typically the finance provider becomes responsible for managing the debtor portfolio and collecting the payment of the underlying receivables. 
The origins of factoring can be traced back to business dealings in England as early as the 1400’s. Around 1620, it was introduced to the Americas by the Pilgrims and grew as an effective means for companies to increase their cash flow.

what are the main drivers for factoring as a means of settlement?

  • Sellers require payment as soon as possible …
  • Buyers wish to delay payment as long as possible … 
  • The provision of flexible financing solutions can help alleviate any concerns on both sides.
  • Normally, finance is provided for transactions payable on 30 or 60-day terms, but this can be extended to 90, or even 180 days.
  • Funding can be provided as early as 24 hours after reaching an agreement with a finance provider (a “factor”).
  • The amount of the advance can range from 70% to 90%, depending on the industry, credit history of the buyer and other criteria.
  • Is to cover an underlying trade or services transaction.
  • Often used to bridge the gap between invoicing and receipt of payment.
  • Favourable financing and pricing terms can make a product or service more competitive.
  • The factor will manage the process for the collection of funds from each buyer.

What type of industries we can assist with factoring services?

Factoring can be considered by a seller operating in any industry where goods or services are sold or provided on, mainly, 30 or 60-day terms; but other periods may be considered. The following are some of the more common industries for which companies will utilise factoring as a means of obtaining finance:

  • Logistics
  • Manufacturing 
  • Wholesale
  • Technology
  • Food services
  • Staffing agencies
  • Courier services
  • Consulting
  • Oilfield services
  • Distributors
  • Advertising
  • Office supplies

What kind of services are offered by us?

Typically, one or more of the following:

  • investigation of the creditworthiness of one or more buyers;
  • removal of credit risk;
  • collection and management of receivables;
  • 100% protection against write-offs;
  • invoice verification (i.e., to avoid fraud); and/or
  • finance by way of immediate advances against outstanding receivables.

The services offered by a factor may allow a seller to offer preferential terms to buyers.
Although a factor will like to see a consistent and continuous flow of invoices, there is no general requirement that a seller must finance all its invoices.
Agreements between a factor and a seller will usually last for 6 months to a year. More competitive rates will often be offered for the longer the agreement lasts.
Recourse and non-recourse financing. The majority of receivables are handled on a recourse basis with the seller agreeing to buy back the receivable if the buyer does not pay on the due date. In this event, the seller must cover the cost of the invoice that is not paid. Non-recourse funding could be charged at anything from 1% above the fee set for recourse financing.