Dr. Rajeev Jain - Trade Finance in Middle East

The aftermath of the global financial crisis has meant that small and medium-sized enterprises (SMEs) have found it difficult to secure ‘traditional’ finance, experiencing a major tightening of lending criteria and a squeeze on credit lines by many lenders.

Trade finance solutions offered by banks may cover a range of services including commodity finance. This provides liquidity management and risk mitigation for the production, purchase and sale of commodities and materials by isolating assets, which have relatively predictable cash flow attached to them through pricing prediction, from the corporate borrower and using them to mitigate risk and secure credit from a lender.

Firms involved in the purchase of bulk commodities should consider a structured trade finance service. Here you should look for an institution that can offer:

• medium-term structured pre-export finance facilities.
• medium-term borrowing base facilities
• short-term transactional bilateral working capital facilities
• payment undertaking guarantees
• and export credit agency facilities