export finance final

8/7/2019 EXPORT FINANCE final

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1. PRIYANKA PUNJABI - 30

1. SHARON ABRAHAM 41

2. KUNAL TEJWANI 48

3. AKSHAY BHADORIA 56


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FINANCE IS THE LIFE AND BLOOD OF ANYBUSINESS

` Success or failure of any export order mainly dependsupon the finance available to execute the order. Nowadaysexport finance is gaining great significance in the field ofinternational finance.

` Many Nationalized as well as Private Banks are takingmeasures to help the exporter by providing them pre-shipment and post- shipment finance at subsidized rate ofinterest. Some of the major financial institutions are EXIM

Bank, RBI, and other financial institutions and banks.EXIM India is the major bank in the field of export andimport of India. It has introduced various schemes likeforfeiting, FREPEC Scheme, etc.


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` Export in simple words means selling goods

abroad. International market being a very

wide market, huge quantity of goods can be

sold in the form of exports.

` Export refers to outflow of goods and servicesand inflow of foreign exchange.


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` EXPORT FINANCE

` The credit required by the exporters for

financing their export transactions from time

of getting an export order to the time of full

realization of the payment from the exporters.

` Exporters generally require finance at 2

different stages:-1. Pre-Shipment .

2. Post-Shipment.


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` Pre Shipment Finance is issued by a financial institution

when the seller want the payment of the goods before

shipment. The main objectives behind pre-shipment finance

or pre export finance is to enable exporter to:

` Procure raw materials.

` Carry out manufacturing process.

` Provide a secure warehouse for goods and raw materials.

` Process and pack the goods.

` Ship the goods to the buyers.

` Meet other financial cost of the business.


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` To purchase raw material, and other inputs to manufacturegoods.

` To assemble the goods in the case of merchant exporters.

` To store the goods in suitable warehouses till the goods are

shipped.` To pay for packing, marking and labeling of goods.

` To pay for pre-shipment inspection charges.

` To import or purchase from the domestic market heavymachinery and other capital goods to produce export

goods.` To pay for consultancy services.

` To pay for export documentation expenses.


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` Eligibility

` Purpose

` Documentary evidence

` Security

` Form of Finance` Amount of Finance

` Period of loan

` Rate of interest.

` Loan Agreement

` Maintenance of Accounts

` Sanction of loan

` Monitoring the use of Loan

` Repayment/Liquidation of loan


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` Submitting Application to the Bank.

` Processing of Application.

` Sanctioning of Loans.

` Loan Agreement.

` Manner of Payment.

` Maintenance of Accounts.

` Monitoring of the use of Loan.

` Repayment/Liquidation of Loan.


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` Extended Packaging Credit Loan

` Packing Credit Loan (Hypothecation)

` Packing Credit Loan (Pledge)

` Advances against Back-to Back letter of Credit.

` Advances against Red Clause L/C.` Advances against Export Incentives.

` Packaging credit for Imports Against Advance LicenseEntitlement.

` Special Packing Credit Schemes:

` EXIM Banks(foreign currency)Pre-Shipment Scheme.` IDBIS Pre-Shipment Credit in Foreign Currency(PSCFC)

` Packing Credit For Deemed Exports.


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` Meaning:

Post shipment finance is provided to meetworking capital requirements after the actual

shipment of goods. It bridges the financialgap between the date of shipment and actualreceipt of payment from overseas buyerthereof. Whereas the finance provided aftershipment of goods is called post-shipmentfinance.


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` To pay to agents/distributors and others for

their services.

`

To pay for publicity and advertising in theover seas markets.

` To pay for port authorities, customs and

shipping agents charges.

` To pay towards export duty or tax, if any.

` To pay towards ECGC premium.


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` To pay for freight and other shipping expenses.

` To pay towards marine insurance premium,

under CIF contracts.

` To meet expenses in respect of after sale service.

` To pay towards such expenses regarding

participation in exhibitions and trade fairs in

India and abroad.` To pay for representatives abroad in connection

with their stay board.


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` Export bills negotiated under L/C

` Purchase of export bills drawn under

confirmed contracts

Àdvance against bills under collection

Àdvance against claims of Duty Drawback

(DBK)

Àdvance against goods sent on Consignmentbasis.


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Àdvance against Undrawn Balance of Bills

Àdvance against Deemed Exports

Àdvance against Retention Money

Àdvance against Deferred payments


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export finance final

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