At DBS, we take pride in helping you manage the complexity and risks in international trade. We have offices located throughout Asia. With our understanding of Asian businesses and trade practices, we have in place a comprehensive suite of trade financing products to facilitate your business needs.
You will be able to enjoy quality and reliable services with our experienced specialists and efficient trading system.
Let us structure your trade transaction needs. So you can seek new business opportunities with confidence.
Our customisable solutions:
Import Products
- Issuance of Letter of Credit (LC)
A LC is an undertaking by a bank (issuing bank), on your behalf (applicant), to make payment for goods or services provided by the supplier (beneficiary) within a prescribed time limit and against stipulated documents. It:
- Secures the settlement of your international trade transactions
- Ensures suppliers fulfil all terms and conditions before payment is made
- Guarantees payment with our universally accepted LCs
- Import Bills purchase
Whether you use documentary credits or collections for your imports, there may be times when you need funding to allow you to fulfil your trade commitments. At DBS we make it our business to understand your business. Your import finance facilities are carefully constructed around your trading cycle, ensuring that funding will always be available to cover your business needs.
- Import Bills for collection
This is a process where an exporter collects payment from an importer using the bank as a trusted 3rd party, without creating an LC. The exporter states conditions for release of documents to the importer and sends the shipping documents to its bank, which then forwards the documents to the importer's bank. The conditions can be Documents against payment (D/P) or Documents against Acceptance (D/A).
- Back-to-Back LC
This type of credit transaction is used when a seller/manufacturer has to purchase a component, or farm out part of the manufacture of a product, but does not have the cash flow to do so. In this case, the seller/manufacturer applies to his bank for a LC, identical to the original LC he received from the Buyer, but of a lower value. This second letter of credit, called a Back-to-Back LC, is sent to the subcontractor's bank to assure the subcontractor that he will receive payment and to proceed with his part of the transaction - supplying components or services to the manufacturer.
- Guarantee and Import Trust Receipt
In certain situations your goods may arrive in port before the shipping documents have been processed through the banking system. A shipping guarantee can offer you the following advantages:
- Enable immediate possession of goods before payment
- Avoid unnecessary delays to the day-to-day running of your business
- Eliminate expensive demurrage / storage charges
- Allow the deferment of payment until your supplier's documents have been presented
A Trust Receipt is a document prepared by a bank and signed for by the importer. It facilitates short-term financing for the importer, which allows him/her to obtain the goods without first settling the payments due under an LC arrangement.
- Factoring and Invoice Financing
Factoring is a process to free up cash from your invoices once they are issued. This allows you to improve your business cash flow. Working with a factoring line of credit puts you in control, and offers greater flexibility than the traditional overdraft. Factoring helps you to trade from a position of financial strength.
Export Products
- LC Advising
Authentication and Notification of Arrival of export LCs.
- LC Transfer
A transferable LC must be so designated, and it allows the beneficiary to request that it be transferred in whole or in part to a second beneficiary or beneficiaries. Transferees may not subsequently transfer them to other parties.
A request for a transfer by a beneficiary of a transferable LC should be carefully considered, taking into account the beneficiary and second beneficiary's standing and ability to perform the shipment, and the terms of transfer. A transfer allows the beneficiary who does not supply the merchandise but acts as a middleman to transfer all of his rights and obligations to a second beneficiary who actually supplies the goods.
- LC Confirmation
The bank may receive a request from the issuing bank to confirm the LC issued by the issuing bank. Confirmation may be requested for when the beneficiary is not comfortable with the financial standing of the Issuing Bank, or is doubtful about the country risk of the issuing bank.
- Packing Loan
A short term facility extended to exporters prior to shipment of goods. While an exporter may have a LC opened in his favor, this may not be very helpful if he does not have immediate cash to obtain raw materials etc, to manufacture and deliver the goods as per LC terms. The exporter can therefore avoid this temporary cash shortage by depositing the LC with his bank to raise an advance, which will be offset against the export LC proceeds upon eventual negotiation.
- Export LC Negotiation
An exporter with a contract to supply goods may have an LC opened in his favour, but may not have sufficient cash flow to maintain the liquidity of his business from the time the goods are shipped to the time the issuing bank makes payment. The exporter can then avoid this temporary cash shortage by negotiating the LC with his bank, and get a cash advance pertaining to the amount stated on the LC, subject to his documents being in compliance with conditions stated in the LC and to the bank's approval.
- Export Bills purchase and collection
- The bank provides financing with the export bill as mortgage to the exporter upon the delivery of goods, and the presenting of documents requested by the LC or contract.
- The export bill purchase business has the following scope: export bill purchase under the LC, export bill purchase under documentary collection, foreign currency export bill purchase and RMB export bill purchase.
- The bank is entrusted with the financial and commercial documents submitted by the exporter, and collects payment from the importer via its foreign correspondent banks or sister-branches.
- Export collection can be classified into two types, namely documents against payment (D/P) and documents against acceptance (D/A).
RMB Bank Acceptance Draft
- Issuance
Bank acceptance drafts are a common instrument used by companies in China to secure credit terms from their suppliers as a local bank guarantees the payment risk.
- Discounting
Bank acceptance draft discounting enables you to access funds that would otherwise be tied up with your debtors, providing you with the ability to accelerate your business' cash flow.