Product Name

Export Bill Discount

Product Description

Export bill discount means that Bank of China Limited Karachi Branch buys from the exporter the undue time draft accepted by banks or the undue debt claim honored by banks under the export L/C, or the undue debt claim guaranteed by banks under the documentary collection. If the issuing bank fails to pay at maturity, Bank of China Limited Karachi Branch has the right of recourse.

Functions

The product aims to meet the short-term financing requirement of exporters by means of buying with recourse immature usance draft accepted by the issuing bank or the nominated bank..

Features

1.Acceleration of capital turnover. Get the fund immediately, so that capital turnover can be accelerated and financial pressure can be eased.

2.Simplification of financing procedures. Financing procedures are more convenient when compared with those for working capital loans.

3.Less financial expenses. The customer can choose the funding currency in accordance with the interest rates of different currencies at Bank of China, so as to minimize the financial expenses.

Target Customers

1.Exporters have limited working capital, they have to develop business through rapid capital turnover.

2.Exporters encounter temporary difficulty in capital turnover between receipt of acceptance/confirmation/guarantee of payment from foreign banks and collection.

3.Exporters discover investment opportunities between receipt of acceptance/confirmation/guarantee of payment from foreign banks and collection, and the yield is higher than the discount rate.

Application Requirements

I.Basic requirements

1.The applicant holds the business license of enterprises legally approved, registered and annually checked and other valid certificates sufficient to prove the legitimacy and scope of its operation.

2.The qualification of import and export operation.

II.The customer has the undue draft accepted by banks or the undue debt claim honored by banks, or undue debt claim guaranteed by banks under the documentary collection.

III.Taking up the credit line of the accepting bank/paying bank/guarantee bank.

Procedure

1.Exporters sign the financing agreement with Bank of China Limited Karachi Branch, and submit the export documents to Bank of China Limited Karachi Branch.

2.After approving the documents, Bank of China Limited Karachi Branch will mail them to the foreign bank (the issuing bank or a designated bank) for reimbursement.

3.Upon receipt of the documents, the foreign bank will give the instruction of acceptance to Bank of China Limited Karachi Branch;

4.Upon receipt of acceptance order, the customers should submit the business application to Bank of China Limited Karachi Branch, and Bank of China Limited Karachi Branch effects the payment to the exporter.

5.Foreign bank effects the payment at maturity, which Bank of China Limited Karachi Branch will use it to cover the discount payment.

Gentle Reminders

1.Exporters should agree with the importer to take the usance L/C as the settlement instrument in the contract.

2.Customers should submit the application to Bank of China Limited Karachi Branch after the issuing bank accepted usance draft or issued acceptance notice.

3.After the usance draft accepted by issuing bank, customers might as well choose export bill discount while encountering the temporary difficulty of capital turnover and having demand for short-term capital financing. After the usance draft accepted by issuing bank, customers might as well choose export bill discounting while discovering new investment opportunities and the expected yield is higher than the discount rate.

4.Bank of China Limited Karachi Branch generally will not provide bill discount for investment purpose which has no real trade background.