Trade finance

importersandexporters

We have solutions to make importing and exporting work for you. We are with you all the way, from before and after shipment and with tailor-made solutions to fulfil your trading obligations. We also help guard against import risks. We offer short-term financing to help facilitate short-term working capital needs. Let us pay your suppliers and convert the payment into a short-term trade loan. Favourable interest will be charged in arrears upon maturity of the loan.

Letters of credit
Export letters of credit

Your supplier abroad may require you to provide an irrevocable letter of credit in their favour to secure a trade transaction.

Our network of branches and correspondent banks enables us to issue letters of credit to beneficiaries in virtually all countries worldwide and in all freely convertible currencies.

Confirmation eliminates the risk of default by the beneficiary to the bank and can facilitate access to a wide variety of finance solutions, both before and after actual shipment has taken place. Upon request, our confirmation may also be added.

Subject to fulfilment of all our requirements, our policy is to ensure the beneficiary's bankers receive our letters of credit within 24 hours of our receipt of your application.

Import letters of credit

Your overseas supplier may require you to provide an irrevocable letter of credit in their favour to secure a trade transaction.

Our network of branches and correspondent banks enables us to issue letters of credit to beneficiaries in virtually all countries worldwide and in all freely convertible currencies.

Subject to fulfilment of all our requirements, our policy is to ensure the beneficiary's bankers receive our letters of credit within 24 hours of our receipt of your application.

Transferable letters of credit

These are letters of credit that can be transferred from the first beneficiary to one or more additional beneficiaries by the transferring bank.

We are currently actively involved in issuing and advising transferable letters of credit on behalf of and in favour of our customers.

Given the risks inherent in these instruments, our trade specialists are available to further discuss the implications, terms and conditions under this type of credit.

To find out more contact us on: +254 20 4254000.
Revolving letters of credit
Revolving letters of credit are useful for buyers and sellers who have a long-standing trading relationship.

They involve our conditional undertaking to reinstate a letter of credit either after the occurrence of a specific event or after a specific time period has lapsed.
Depending on your needs, we will undertake to reinstate these instruments automatically and without the requirement of any further amendment from you.

The number of times this can take place will be agreed upon and specified in the credit documentation.
Standby letters of credit
We assist you with various letters of credit to secure your trade transactions.

While payments under regular letters of credit are generated by the performance of the exporter under a specified trade contract, payments under standby letters of credit are generated by the default of the importer under a specific trade contract. Standby letters of credit are irrevocable and payable on demand.

Upon your request as an importer, we can provide this form of conditional undertaking on your behalf to the beneficiary.

Should you fail to make settlement, we will make settlement on your behalf upon the presentation of specific documents by the beneficiary required under the credit agreement.
Credit financing
This is usually applicable in instances where certain unfavourable market conditions exist on the due payment date and for one reason or another, the applicant is not willing to make settlement.

We can arrange to make settlement of import letters of credit on your behalf and refinance you locally up to 180 days after payment date, depending on your requirements.

This arrangement can be applied in various instances and ultimately provides you with flexibility to manage your cash flow.

To find out more contact us on: +254 20 4254000
Import documentary collections
We help you ensure that your suppliers present import documentary collections.

Under documentary collections, your overseas suppliers present appropriate documentation to their bankers, which are then forwarded to us to facilitate collection on their behalf.

We ensure that you are advised promptly and that their instructions are carried out exactly as per their requirements.

Different forms of financing can be arranged, based on the presentation of appropriate documentation.

To find out more contact us on: +254 20 4254000
Bills of exchange
By endorsing bills of exchange, we can assist you when your exporters require payment guarantees.

Exporters may require a third party, usually a bank, to guarantee payment of a bill of exchange drawn on an importer under a trade contract.

This action is known as 'avalisation' and can be provided on behalf of the exporter upon request.

By endorsing the bill on the back, the bank commits itself unconditionally to pay should the drawee default.

An 'avalised' bill substitutes the bank's risk for the importer’s risk, which provides the exporter with the assurance that the payment will be made.

This bill can subsequently be discounted or used to negotiate better credit terms, which can enhance the trading relationship with the importer.

To find out more contact us on: +254 20 4254000

forfaiting

This specialised facility expedites payment and cash flow for you as an exporter and can eliminate credit risk.Receive cash immediately without forfaiting. Forfaiting is a means of financing used by exporters that enables them to receive cash immediately by selling their medium-term receivables (the amount an importer owes the exporter) at a discount. Under this specialised facility, we purchase obligations falling due at some future date arising from the sale of goods or services without recourse to the seller.

How it works:

This is a transaction-based facility and is generally evidenced by the use of negotiable instruments such as bills of exchange and promissory notes guaranteed by a third party – usually a bank.
Traditionally used in financing of exporters, forfaiting has evolved to also suit local traders/sellers and we have been at the forefront of this.
To find out more contact us on: +254 20 4254000

supplierfinance

Benefits

We'll help streamline payments to suppliers. With our electronic banking system, payments to suppliers will be facilitated easily and will provide access to cash for your suppliers.
We will discount the amounts payable and remit the net proceeds to each supplier without recourse once a written agreement has been issued.
The payment process will be facilitated electronically.
Suppliers will be prepaid and have access to cash required for delivering services.
We will facilitate the payment process electronically – making it easier and quicker.
With our electronic payment system, your suppliers will get direct access to cash to provide services or products

How it works

You issue post-dated instructions to pay specified suppliers at a future date.
You then supply us with a written agreement from a supplier who has to be prepaid.
Telegraphic transfer charges, interest on discounting and handling fees will be applied to the supplier’s account at pre-agreed rates.

trademanagementonline

Our award-winning platform
Get access to our suite of trade finance solutions from your mobile device or computer, 24/7, no matter where you are. As small, medium, large and corporate clients, you are able to initiate, receive and manage the full lifecycle of our current trade finance product offering, through our Trade Management Online (TMO) platform.

In the ever-changing business landscape, Absa continues to find innovative ways to ensure that your business has access to world-class solutions that are accessible, digital and secure. Now more than ever, your import and export business requires seamless ways to access Trade Finance remotely so that even in the midst of a pandemic, business keeps moving. If you’re already using Absa Access, simply login and select Trade Management Online. If you are a new user, please contact us for access.

Benefits of Trade Management Online

Accessibility: Trade Management Online is accessed through our Absa Access platform, allowing for a single point of contact for all your business requirements

Convenience: Experience the simplicity of trade finance with our paperless digital facility, no matter where you are

Seurity: Our industry-leading two-factor authentication provides the highest level of security for your business transactions. Use self-service to manage your passwords, authorisation levels and user mandates
Services offered
Facilitate your trade finance requirements with these services

Import and export letters of credit

Inward and outward foreign and local guarantees

Import and export documentary collections

Import and export trade loans

View the TMO brochure
TMO demo video

Explore our Trade management Online platform with this demo video

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othertradesolutions

Trade solutions for company growth. We cover the whole spectrum of trade finance solutions – from guarantees, bonds and indemnities to invoice and bill discounting. Bank guarantees provide a number of advantages to both international and local businesses. Different types of financial and commercial documents are exchanged during trade transactions, which provide evidence of a transaction as well as acknowledgement of debt.

Guarantees, bonds and indemnities improve the terms of your tenders to negotiate better terms on contracts. They enable you to tender for business that you might have previously considered out of reach and improve the terms of your tenders and they can help you negotiate better terms on contracts. Invoice and bill discounting enhances your cash flow position with our competitively-priced solution.