Advance Against Collections

Stephen A. Jones ()
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Stephen A. Jones: AXS Trade Finance Ltd.

Chapter 4 in The Trade and Receivables Finance Companion, 2019, pp 31-49 from Springer

Abstract: Abstract A documentary collection is a method by which the banking system is used by the seller to collect payment from the buyer. Financing collections can often provide a better alternative for the financier than lending on overdraft given the control, visibility and capture of proceeds. The risk and benefits of this financing technique are discussed in comparison with a bank overdraft. Detailed guidance is provided on the financing structure, criteria for facility drawdown, the terms and calculation of the credit facility requirement.

Keywords: Advance against collections; Bank aval; Bill of exchange acceptance; Bill purchase; Credit facility; Credit insurance; Determining the amount of finance; Documentary collection; Financing structure; Funding mechanism; Protest; Recourse; Trade cycle (search for similar items in EconPapers)
Date: 2019
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-030-25139-0_4

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DOI: 10.1007/978-3-030-25139-0_4

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