Emerging businesses needs capital injection, construction contractors, project consortiums, importers, and trading houses, needs non fund based products like Bonds, Guarantees (BG) Standby letter of credit (SBLC), letter of credit (DLC), and SWIFT services to participate in a tender, project, or a sales contract. due to a lack of assets and banking restrictions, credit facilities are limited to fulfill their demands. our company international trade finance (ITF) offers collateral-free unsecured trade finance for startup, SMEs, and large corporations.
Bonds are consist of many types in those most common bonds are used in construction and project execution (Bid bonds, performance Bonds, Advance payment, Warranty bonds, Payment bonds are common among the bonds), its a type of guarantee used between the contractor (applicant) and the beneficiary or Obligee. If applicant fails to meet the promise either financial or by performance, this bonds will take an effect in favor of obligee.
Bank guarantees (BG) in other hand used in the sales contract or an international trade to secure the buyers and sellers demand, It’s a legal document used in global trade to govern the payments and performance, to fulfill the financial obligations. If the applicant fails to deliver the commitments either financially or by performance, the beneficiary can raise a complaint against the applicant and demand the guarantor to recompense. Rules and regulations published by ICC as International Standby Practices (ISP) and Uniform Rules for Demand Guarantees (URDG).
A standby letter of credit (SBLC) is a trade finance tool for international trade, It has a payment commitment to the seller from the issuing bank incase of breach in sales contract. SBLC helps to facilitate the trade between unknown buyers and sellers who has different governing laws and regulations. Rules and regulations published by ICC as International Standby Practices (ISP) and Uniform Rules for Demand Guarantees (URDG).
Standard wording as per ICC URDG Practice.
Customized wording as per compliance approval.
Acceptable worldwide by all governing bodies & Organizations.
Financial and performance based bonds and guarantees.
Both SWIFT & hardcopy format.
Ease of compliance and due diligence.
Standard wording as per ICC - URDG & ISP Rules.
Acceptable worldwide by all governing bodies & Organizations
Financial and performance based SBLC & BG's
Documentary letter of credit (DLC) is widely used by the importers and exporters in global trade to reduce non-payment risks, DLC’s will act as an irrevocable instrument to fulfill the condition as per At sight or deferred payment terms. And it is issued by banks and financial institutions by promising the payment under the stipulated terms. Standardized rules published by the International chamber of commerce (ICC) as Uniform Customs and Practice for Documentary Credits (UCP) terms.
Standard wording as per ICC - UCP Rules.
Document collection and release
Strong correspondent bank network
Asset backed & Flexible invoice settlements
The standard model of a bank to bank communication is delivered via SWIFT Channel. Apart from letters of credit and Guarantees most common products are Ready willing and Able messages (RWA), Pre Advice, Proof of Funds (POF), Comfort Letter (BCL), etc.
Project developers and bidding contractors use these terms in project finance. Such standard messages are issued via SWIFT MT modes.