Beginner's Guide to Exporting. 4th Edition.

1 9 Beginner’s Guide To Exporting 5.2 TRADE FINANCE FACILITIES Facility Description ECR (Export Credit Refinancing) (Available from participating commercial banks) Provide an alternative short term pre and post shipment financing to direct / indirect exporters. Promote the exports of Malaysian manufactured products, agricultural products and primary commodities. Pre-Shipment Facilitates the production of eligible goods for export prior to shipment and encourage the backward linkages between the exporters and local supplier. Post Shipment Bridges the funding requirement of exporter from shipment to receipt of payment of the export bill. Supplier Credit Facility (Available from commercial banks and EXIM Bank) Pre-Shipment finances working capital for production of goods while the Post-Shipment finances the export bill after shipment has been made. Purpose To promote the export of Malaysian goods through financial assistance for production of goods and discounting of export bill Bank Guarantee (Available from commercial bank and EXIM bank) Facilitate the issuance of bonds for overseas contract undertaken by Malaysian contractors and also to enable Malaysian investors to raise funds in overseas. Purpose Facilitate bond and guarantee issuance requirement including Tender/Bid Bond, Performance Bond, Advance Bond, Standby Letter of Credit (SBLC), etc Import Financing (Available from EXIM Bank only) Facility to Malaysian owned or controlled companies which trade in both export and domestic markets that demand specialised finished or intermediary goods that are unavailable in Malaysia. Eg , high tech instrument, calibration instruments, specialised medical equipment (strategic goods). Purpose To finance the import of strategic goods or services which are unavailable in the country which is beneficial to the competitiveness of the country’s product. SOURCING FOR EXPORT FINANCING CHAPTER 5 5.2.1 Conventional Trade Financing