Supplier’s Credit | Meaning & Process | Financeseva

 Have you heard about Supplier’s credit its an facility of arranging funds for importers using LC. Even you can avail Supplier Credit for better Cash Flow.

What is Supplier’s Credit?

Supplier’s Credit relates to credit for imports into India extended by the overseassuppliers or financial institutions outside India. Usance Bills under Letter of Credit(LC) issued by Indian bank branches on behalf of their importers are discounted by Indian bank overseas branches or Foreign bank.

Why is Supplier’s Credit required?

Suppliers would ask for sight payment where as you want credit on the transaction. At times, in capital goods, banks would insist on using term loan instead of buyer’s credit. By this way you can avail cheap LIBOR rate funds and your supplier would also not mind as he is getting funds at sight.

How quickly can the supplier sign up for supplier finance?

Once the buyer has agreed to the participation, the on-boarding process can be quick. On average, companies can be onboarded in 4 business days.

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Buyer Credit
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Letter of Credit
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Supply Chain Finance