Exporters who have to wait months till their invoices are cleared can conveniently benefit from export factoring. Exporters can get paid immediately and optimize the cash flows.
This financing solution is oriented towards any business exporting overseas and working extended credit periods. It is also helpful for those companies whose banking limits are insufficient or not compatible as per their business needs.
CapoFin ensures a shorter working capital cycle for your business, i.e., you get paid as soon as the goods are shipped.
Few of the CapoFin’s long-term established lending partners can also secure you against certain non-payment scenarios ensuring your time is spent doing what you do best and leave the issues related to international trade such as liquidity, collections on maturity etc.
CapoFin arranges trade finance from its lending partners (trade funds and FIs) to small and medium sized companies engaged in domestic and cross-border trade across the globe using technology and data analytics.
Importer sends a purchase order (PO) to the Exporter
Exporter invoices the Importer noting CapoFin's lending partner as the “bill to” party
Exporter ships goods to the Importer as per agreed PO terms
Exporter presents required shipping documents to the Lender under the agreed post-shipment financing model.
Importer communicates acceptance and Lender advances up to 97% of shipment value within 1-2 days
Lender collects proceeds from the Importer on due date of the invoice and remits the reserve minus interest to the Exporter
CapoFin’s Finance for Exporters is a post-shipment financing facility for domestic and cross-border transactions on a non-recourse basis. This means that CapoFin’s lending partners buy the receivables from a seller and provides them with access to funds immediately.
CapoFin’s lending partners take over the credit risk of the buyers up to the financed amount which in certain cases can be up to 100% of the invoice value. CapoFin’s Finance for Exporters is a collateral-free financing instrument for suppliers.
Once the goods are shipped, the Supplier digitally uploads shipping documents, invoice and the purchase order onto the lending partner’s portal. The lender then pays out up to 100% of the invoice amount (in certain cases) minus the charges to the seller within 48 hours of shipment of goods. On maturity of the invoice, the buyer pays the lender directly as per the Seller’s agreed payment terms with the Buyer. If up to a certain percentage of invoice amount is financed, the lender pays the residual amount to the Seller upon realisation of the same on the due date.
- The lending partner will take on the responsibility to look after your receivables which allows you to focus on the core activity of your business.
- You receive immediate liquidity on shipment which can be used for and advance payments to suppliers under back-to-back trade
- You get protection against default by your buyer due to insolvency. CapoFin will initially analyse risks and provide assessment to its established lending partners who further conduct due diligence on clients and suppliers, in order to assess and price any possible risk of default
- You do not have to pledge any collateral
- The financing is indeed sale of the receivables and is ‘off-balance sheet’
- Some lending partners can provide you with a confidential export financing facility, which means that your clients won’t know that you are using a discounting facility; one for consideration when it comes to reputation/policy of your business
- Financing for Exporters can also help businesses grow their trade and fulfil customer orders without having to worry about working capital and cash flow cycles
The lending partner may contact your buyer initially for acknowledgement of invoices and confirmation that the payment will be made to them directly on due date of the invoice.
Yes, the balance amount which is deferred can be financed.
Yes, CapoFin’s network of lending partners include pre-shipment financiers as well; financing on the back of Assignment of Proceeds under Export LCs in certain cases.
It varies from case-to-case as CapoFin’s financing network is spread across globally.
Invoice Factoring or Bill Discounting or Export Financing, is a form of receivables finance where the factor (CapoFin’s lending partner) buys the invoices issued by a seller (exporter), providing immediate liquidity and buyer credit default protection.