Products & Services

Home > Products & Services > Trade Finance
Trade Finance
 FORFAITING

1) Product Overview: 
Forfaiting business, also known as buyout, means that CCB, based on the requirements of customer (beneficiary of L/C), carries out the financing without recourse on the receivables upon the payment commitment on the payment under the L/C by the issuing bank or confirming bank or other designated bank. 
 
2) Product Function/Applicable Target: 
1. Upon the commitment of payment at maturity of the issuing bank or confirming bank or other designated bank for the usance L/C, CCB will immediately offer you the full, no-recourse financing.  
2. The currency of discounting is the same to that of L/C; the interest rate will be determined according to the risk degree of the payment commitment bank and the region located; the term of financing is flexible.  
 
3) Product Advantage/Feature: 
1. Full amount financing. The amount of forfaiting financing is 100% of the amount of L/C. The financing percentage of products as factoring, export commercial invoice financing is only 80% of the invoice value.  
2. Fixed interest rate. The forfaiting financing offered by CCB is fixed interest rate, which makes you lock the financing cost. 
3. Non-recourse. In terms of true and valid trading, as long as the forfaiting financing has been obtained from CCB, it can be deemed that the exchange has been normally received, and then there are no worries. The credit risk, national risk has been transferred to CCB. 
4. Tax refund in advance. Given the nature of non-recourse of forfaiting, CCB, upon the granting of financing, will issue you the dedicated form of export proceeds charge-off so that you can operation the export tax refund formality immediately.  
5. Avoid exchange rate risk. Upon the obtaining of the financing fund via forfaiting business, the settlement of exchange can be conducted immediately to effectively avoid the exchange rate risk.  
6. Increase trading opportunity. You can offer import more attractive usance payment condition, and consider the formerly thought high risk trade zone as well so as to add trading opportunity to enhance competitiveness.  
7. Improve financial statement. Since the forfaiting business is the discount without recourse, you can deem to actually receive the exchange so as to increase current cash flow, reduce receivables and optimize financial position.





No. Page