Forfeiting

Product Introduction

Forfeiting is a discount without recourse offered for the receivable by CGB upon the request of the customer (the beneficiary of the L/C), after the letter-issuing bank or the conforming bank or other designated bank has made a payment commitment to the payment under the L/C.

Product Features

1.For a truly valid trade, after the loan is released, the bank has no recourse over you, thus you avoid the credit risk and national risk of the payment collection.

2.After the loan is released, it is equivalent to a collected payment, thus you can immediately get a dedicated copy of export payment collection settlement issued by the bank, process the settlement procedure earlier, and apply for state export tax rebate earlier.

3.It provides you with more trade opportunities. You can give the importer more attractive forward payment conditions, or consider some trade regions you thought to be highly risk previously, thus you will have more trade opportunities and your competitive power will be boosted;

4.It improves your financial statement. Since forfeiting is a discount without recourse, it can be deemed as an actually collected payment; therefore, you can correspondingly reduce the number of receivables, and you don¡¯t have to indicate it as a bank loan, thus you can optimize your financial statement.

5.The collected foreign exchange payment can be immediately settled, which avoids the risks in the exchange rate.

Our Commitments

1.The loan amount can be 100% of the acceptance amount of the L/C (after the discounting interest and service charge are deducted);

2.No matter how long the loan term is, the loan is made at a fixed interest rate, therefore you can fix your loan costs;

3.The interest rate is determined according to the degree of risks of the payment guaranteeing bank and the country where the it is situated in; the lower the risks, the lower the interest rate.

4.The loan currency can be the collected in payment currency or RMB. In case of a foreign currency, it can be settled on the same day upon your request.

5.The loan doses not occupy your bank credit line, or requires an extra guarantee provided by you.

Kind Reminders

1.No recourse is relative. If the letter-issuing bank receives a stop-payment order issued by the local court or the trade is suspected to be a fraud, our bank has the recourse;

2.Under such a circumstance as that the polity or economy of the country where the letter-issuing bank is situated in is unstable, or that the credit standing of the letter-issuing bank itself is not so good, although the loan is a forfeiting under the L/C, it will not be easily granted by the bank, or the loan cost will be relatively high.