BACKGROUND OF TRADEFINANCE2020

Through the financial strength and resources now available through KIPCO Group1, starting January we introduce new trade finance facilities for qualified companies, financing any legal cross boarder transaction between selective countries. TRADEFINANCE2020 enables exporters to grant credit facilities to buyers of up to 5 years, and still receive the immediate Non Recourse payment upon shipment.

An exporter can sell his products with a typical payment tenor of 180 to 365 days. The exporter can get paid right after shipment while the importer pays within the agreed period of time.

For TRADEFINANCE2020 to work, it has to be backed up by a financial guarantee, usually a documentary letter of credit issued by the buyer’s bank

ESSENTIALS OF TRADEFINANCE2020

Low cost finance for solid clients and good banks.The Importer will have to be able to issue a L/C or DLC through his own bankThe Importer’s bank does not have to be top Tier. Exporter and Importer have to have an established solid business track record and be able to evidence significant trading activities and audited statements for at least the past 3 years.

(1) KIPCO Group, Kuwait Projects Company (Holding) has Consolidated Assets in excess of USD 34 Billion (2018), controls 60 companies across 24 countries and employs 16000 people.

SUMMARY DETIALS

For established companies onlyThe service is for well established buyer- and seller companies only. This is not available for you if you do not have an established company and a longer term track record of successful trading.

The Importer’s bank has to support its clientYour client’s (importer’s) bank will have to agree to issue a Letter of Credit guarantee instrument to support the transaction. This can be for payment tenors from 180 days to 5 years, although most commonly tenors are 180/360 days.

The verbiage of the LC has to assure “no recourse”The guarantee instrument will be drafted to assure that there cannot be a later claim resulting in a legal dispute.

The bank has to be acceptableThe buyer’s bank (issuing the guarantee instrument) will not need to be a prime world bank, but it will have to be an acceptable institution. In some instances a confirmation may be required from the issuing bank’s European counterpart.

The country of the importer has to be “on our list”There is a regular evaluation of country risk and we publish this list providing information of “our” country rating and the maximum tenor that can be acceptable for selective transactions which can be from 180 days to 5 years.

The higher your margin, the better the chancesThere has to be sufficient margin in the transaction. The higher the margin, the greater are the chances that your transaction is acceptable for our financing strategy.

The costs involvedThis is a very competitive financial model based on low interest rates. Ultimate costs depend upon the individual transaction, the parties and the risks involved. As a general guideline, the transaction costs involve a set up fee of about 1% or less, and annual costs (pro rata) of around 6% (p.a.) plus commission.

Transaction SizeThere is a single obligor limit of around Euro 35 M. Typical transaction value is however Euro 17 M.

INITIAL EVALUATION FORM REF:

PartiesExporter Company NameLocation / Country Shipment will be from (country)Importer Company NameLocation / CountryShipment will be sent to (country)

Importer’s Guaranteeing Bank (full details)

TransactionWhat Products / Commodities are imported / exported (the underlying transaction)Total trade finance required in USD or EuroTenor & other Payment Terms CIF / FOBShipment ScheduleHow much is earned in this transaction total?Estimate and state in in USD or Euro

Full details about the Seller / Exporter

Company Name and Address

Have you conducted a transaction with this buyer / importer before? If YES, please describe your previous transaction.What was your estimated turnover 2019 €/USDWhat was your estimated turnover 2018 €/USDWhat was your estimated turnover 2017 €/USD

Full details about the Buyer / Importer

Company Name and Address

Have you conducted a transaction with this Seller / Exporter before? If YES, please describe your previous transaction.What was your estimated turnover 2019 €/USDWhat was your estimated turnover 2018 €/USDWhat was your estimated turnover 2017 €/USD

Your Trade & Finance PartnerWho provided you with this form / information?

Who submits this Form (importer or exporter)?DateMr. Mrs.:Email the completed form to service@commoditytrading.international