Berkeley Trade Finance offers flexibility and expertise in looking beyond established parameters when considering a financing proposition. Our financing criteria are based on an order from a credit insurable end customer. We will finance transactions from as small as £25,000 up to £1,000,000, with each case being considered on its own merits. Flexibility and the ability to look outside the box are the key factors in our organisation.
Many companies are faced with opportunities to take on additional business but may be prevented from doing so due to inadequate financial resources. Limitations on the financial resources of small businesses routinely arise through a number of factors which may include rapid expansion, seasonality of the business, exceptional one-off large orders or restrictions imposed by the final customer’s credit requirements. If your business faces any of these problems then trade finance may offer the solution.
Trade finance is most simply understood as the ability to provide financing for a transaction that spans from a supplier of goods “the seller” to the final customers “the buyer”. This covers both international and domestic transactions and often involves an intermediary party “the client” who buys from the primary manufacturer and sells to the actual end user or retailer.
This can be achieved by transferring the risk to the credit worthiness of the final buyer of the products via a factoring or invoice discounting facility. Such facilities on a stand-alone basis only address the post delivery cash flow requirements by funding a company against their sales ledger or a selection of customer sales invoices once goods have been delivered. However combined with a purchase finance facility then “the client” is also provided with the finance at the time of the purchase of the goods from the supplier.
Fuelling your international business activities through bespoke, cutting-edge finance.
Going beyond conventional approaches to help you rapidly overcome the hurdles of global trade.
Comprehensive financial packages shaped in a spirit of mutuality, and sensitive to your relationships.
Companies that have confirmed orders from credit worthy end customers can utilise the facility in conjunction with Berkeley’s invoice finance product.
As part of Berkeley’s comprehensive solution the facilities can be utilised to manage the full supply chain, through sourcing, quality control, shipping, insurance, customs clearance and delivery. Additionally the facility can also fund VAT, duty, freight and marine insurance.
Prerequisites to a combined product transaction
The Purchase Finance product can assist clients to achieve the following:
1. Berkeley issues purchase order in favour of supplier.
2. Supplier ships goods via freight forwarder who has prior notice of Berkeley’s title to and control of the goods.
3. Supplier sells goods to Berkeley and presents documents, (typically comprising commercial invoice, packing list and bill of lading) to receive payment.
4. Berkeley sells goods bought from supplier to Client (keeping retention of title). Settlement by Client is to be implemented by Berkeley invoice finance as exit route.
5. Delivery of goods to End Customer is completed.
6. Client raises invoice on End Customer with assignment notification.
A full set of documents, (copy of invoice, delivery note and purchase order) from End Customer is sent to Berkeley.
7. Berkeley makes available initial 85% advance payment under invoice finance product, less balance outstanding on purchase finance transaction plus fees and interest accrued.
8. Berkeley will be in charge of the credit control and collect the outstanding invoice (debt) from End Customer.
9. Berkeley will make final payment to Client, which comprises the balance of 15% less any additional interest and charges accrued.
Once a credit limit is established on the client company, Berkeley are able to issue purchase orders and if necessary open Letters of Credit in favour of the suppliers to agreed terms and effectively provide clients with open credit terms. This a cost effective method of funding special opportunities at times when a clearing bank may perhaps be reluctant to extend overdraft or loan facilities.
Prerequisites to a purchase only transaction
1. Berkeley issues purchase order and if necessary Letter of Credit in favour of supplier
2. Supplier ships goods via freight forwarder who has prior notice of Berkeley’s title to and control of the goods
3. Supplier presents documents, typically comprising commercial invoice, packing list and bill of lading to receive payment
4. Berkeley raises sales invoice and bill of exchange on Client
5. Client returns bill of exchange endorsed and fully accepted
6. Supplier is paid
7. Documents (packing list, bill of lading) given to Client, and goods are collected by Client direct from supplier
8. Berkeley presented the Bill of Exchange to the Client’s bank and on maturity date Berkeley is paid
Thanks; I couldn’t have built what I now have without Berkeley, so, I, sincerely, thank you all. I will recommend you to any other similar businesses.
Stationary Supplier – South East
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