Self liquidating credit
The bank allows the exporter to repay the loan after he receives the final payment and continues to finance all the interim needs of the exporter.
Conclusion Packing credit is essential pre-shipment finance available to the exporters.
However, it will surely be lower than various standard loans.
Due to its self-liquidating feature and customized loans, packing credit enjoys flexible terms.
Packing credit is the most commonly used trade finance tool by an exporter.
Generally, importers are not ready to advance payments to exporters as it is not secure and full of risk for them.In such scenarios, the facility of export packing credit supports the exporter’s supply chain and provides the funds to bridge the gap until the final payment.