Structured Trade Finance

What is Structured Trade Finance?

Structured Trade Finance (STF) is a specialised form of trade finance designed to facilitate complex cross-border trade transactions, especially in emerging markets or in cases where traditional financing is difficult to secure.

It typically goes beyond traditional financing methods letters of credit or simple loans and uses tailored financial structures to mitigate risks for both buyers and sellers.

Key Features:

• Collateral-backed: Financing is secured against assets such as goods, receivables, or export contracts. 
• Risk Mitigation: Helps manage country risk, payment risk, and commodity price risk.
• Customisation: Each deal is structured to suit the transaction, industry, and counterparties.
• Enabler of Trade: Especially useful in commodities, large-scale imports/exports, and emerging markets where traditional financing may not be available.

Structured Trade Finance includes: 

• Pre-Shipment Finance:  Pre-shipment finance includes any finance that an exporter can access before they send goods to a buyer. 
• Pre-Payment Finance:  Pre-payment finance is subtly different to trade finance (or import finance). In this case, the buyer will take out a loan specifically for the purpose of paying the seller, in advance of the goods being shipped. 
• Post-Shipment Finance:  Post-shipment finance includes any finance that an exporter can access after they send goods to a buyer. Without finance, the exporter would wait for the goods to arrive, an invoice to be raised and the payment terms period (typically 30, 60 or 90 additional days). 

To learn more about how we can structure your trade finance, get in touch with us today.