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Trade finance is a vital component of global commerce, as it helps to finance the movement of goods across the globe and facilitates international trade.
In fact, trade finance is estimated to support up to 90% of global trade, providing financing for the import and export of goods and services worth trillions of dollars each year (Source: ICC Banking Commission).
Trade finance plays a critical role in enabling companies to import and export goods and services.
When a company wants to buy goods from another country, it typically needs to pay for those goods upfront, before they are shipped.
This can be a significant financial burden, especially for small and medium-sized enterprises (SMEs) that may not have the necessary funds on hand.
Trade finance helps to alleviate this burden by providing financing for the purchase of goods and services.
For example, a bank may provide a trade finance loan to a company that wants to import goods from another country.
This loan can be used to pay for the goods upfront, allowing the company to receive the goods and sell them to its customers before it needs to repay the loan (Source: Export.gov).
