Pre-shipment finance includes any finance that an exporter needs before they send goods to a buyer. Once the business has a confirmed order from a buyer, which is sometimes backed by a Letter of Credit, working capital finance is often required to fund wages, production costs and buying raw materials. Exporters can access receivables backed financing, inventory/ warehouse financing and pre-payment financing.
Import finance is essentially a loan where the goods exported are the security. Lenders will often fund up to 85% of the total value of the goods, but this can vary depending on the risk of exporting the goods and the lender. The goods being exported are also an important consideration for import finance lenders.