Offshore working capital and trade finance explained.
Cross-border businesses often pay suppliers, freight providers, and duties before customers settle invoices. These facilities are designed around that timing gap.
Revolving working capital
A revolving facility allows approved amounts to be drawn, repaid, and reused during its term. Availability may be fixed or tied to eligible receivables, inventory, liquid assets, or another borrowing base.
Receivables finance
Receivables facilities advance funds against qualifying invoices. The lender reviews the customer, invoice, payment terms, concentration, disputes, and collection route before deciding what is eligible.
Purchase-order and supplier funding
Funding may cover a supplier payment needed to complete a confirmed order. The lender assesses the buyer, supplier, margins, logistics, inspection, insurance, and control of sale proceeds.
Trade instruments
Letters of credit, documentary collections, guarantees, and structured trade facilities allocate payment and performance risk differently. The right instrument depends on counterparties, countries, goods, and shipment terms.
Currency and settlement risk
A borrower earning one currency and repaying another can face material exchange-rate risk. A sensible structure identifies the exposure, settlement timing, and whether hedging or matched-currency borrowing is appropriate.
General information only, not an offer of credit or legal, tax, investment, or financial advice.