D-1-5-1- Fortaiting procedures


Payment processing is one of the main preoccupations of companies with international transactions. Doing business is important, but compensation is essential. Esandis offers you free training space dedicated to international transactions, and all the skills you need to become an export or import manager. Our objective is to provide you an understanding of the importance of the payment component of an international transaction.

Companies are always looking to find new solutions for international protection and funding. There are many payment technique solutions, and most involve the importer's and/or the exporter's bank, e.g. the documentary credit. Another solution, forfaiting, is widely used and, like the other techniques, has its advantages and drawbacks.

1-5-1-1- Forfaiting : definition

Forfaiting is a proven payment technique that provides the exporter short-term, fixed-rate funding for international transactions.

1-5-1-2-  Fortaiting procedures with a "framework warranty" step by step



Exporter

Exporter's Bank

Importer's Bank

Importer
       

Exporter

  

1- Contract
     

Importer
   

 

        

Exporter

  

2-Delivery and billing
 

 Importer
   

 

      

Exporter

  

3-Draft
 
  4-Draft remits for discount  

 

    
   

Exporter's bank

   5-Endorsement request  

           
       

Importer's bank

   
           
   

Exporter's bank

   6-Endorsement    
           

Exportateur

   7-Cash payment   8-Payment at due date  

Importer
           
   

9-Payment at due date

 

Importer's bank

   
   

       
   

Exporter's bank