Steps Involved
- The customer will import the goods either under LC, collections or open account
- The customer requests the Buyer's Credit Arranger before the due date of the bill to avail buyers credit financing
- Arrange to request overseas bank branches to provide a buyer's credit offer letter in the name of the importer. Best rate of interest is quoted to the importer
- Overseas bank to fund Importer's bank Nostro account for the required amount
- Importer's bank to make import bill payment by utilizing the amount credited (if the borrowing currency is different from the currency of Imports then a cross currency contract is utilized to effect the import payment)
- Importer's bank will recover the required amount from the importer and remit the same to overseas bank on due date.
- It helps importer in working capital management.
Read more about this topic: Buyer's Credit
Famous quotes containing the words steps and/or involved:
“Every true man is a cause, a country, and an age; requires infinite spaces and numbers and time fully to accomplish his design;and posterity seem to follow his steps as a train of clients.”
—Ralph Waldo Emerson (18031882)
“Do you suppose that sacrifice is the hallmark of moral action?Just stop to consider whether sacrifice is not involved in every action that is done with deliberation, the worst as well as the best.”
—Friedrich Nietzsche (18441900)