Export Cash Credit (Hypothecation)
This is for a shorter period mainly to purchases raw materials or to obtain exportable goods. The goods are kept under the control of the exporter. Bank creates charge at the time of disbursement, as the bank enjoys the right to take possession of the goods and in case of need, the bank can exercise the power to dispose at the goods for realization of the advance. The exporter has to submit stock report to the bank usually on monthly basis and the bank will very the physical stock. Export Cash Credit (Pledge)
This is also an advance for short period. The exportable goods are kept under the effective control of the bank either at exporters or at banks godown. Movement of the goods will be under supervision of the bank. Bank maintains its proper records through godown storage challan, delivery order, and godown register etc. the ownership of the goods although retained with the exporter. Bank, in this case too, by creating charges on the goods at the time of disbursement of credit, enjoys the right to dispose of the goods after serving proper notice to the exporter for realization of the outstanding if needed. Documentation: 1) Export registration certificate 2) Banks usual charge documents to be signed by the exporter or his duly authorized agent. 3) Confirmed irrevocable export letter of credit or firm contract made by the buyer with the exporter. 4) Insurance cover. 5) Export finances guarantee in favor of the bank 6) Bank may or may not call for collateral securities on the basis of the banker customer relationship in case of export cash credit (Hypothecation). Foreign Remittance “Foreign remittance” means purchase and sale of freely convertible foreign currencies as admissible under Exchange Control Regulations of the country. Purchase of foreign currencies constitutes inward foreign remittance and sale of foreign currencies constitutes outward foreign remittance. The transaction of the authorized dealer in foreign exchange involves either outward or inward remittances of foreign exchange from one country to another. As an authorized dealer the Motijheel branch of IFIC BANK provides its customer foreign remittance facilities by FBC, LFBC, sale and purchase of FCY, FTT, FDD, traveler’s check, FBP
Foreign Bill for Collection (FBC)