Securing credit for small businesses can be challenging since traditional financing options rely heavily on credit history, which many small businesses may lack. However, Tech Cargo's logistics-based trade finance offers an innovative solution to this problem.
This approach enables small businesses to leverage their merchandise as collateral and access funds to cover trade-related expenses such as purchasing goods, transportation costs, and discount fees. In this article, we will guide you through the process we follow to provide innovative trade finance solutions.
Whether you're an importer or exporter, looking to expand into new markets, or optimize your supply chain, our logistics-based trade finance can give you the flexibility and control you need to take your business to new heights.
Now, let's take a closer look at the steps involved in this innovative service, which is designed to strengthen your business.
- Initial Consultation: The process begins with an initial consultation between Tech Cargo and the client. During this consultation, the client discusses their trade finance needs and goals.
- Assessment of Trade Transaction: Tech Cargo evaluates the specific trade transaction in question. This assessment includes examining the type of goods, the countries involved, the logistics requirements, and the financial aspects of the trade.
- Logistics and Shipment Planning: Once the trade transaction is understood, Tech Cargo collaborates with the client to plan the logistics of the shipment. This includes determining the most efficient transport methods, routes, and timelines for the goods to reach their destination.
- Cargo Handling and Monitoring: Tech Cargo takes responsibility for handling and monitoring the cargo from the point of origin to the final destination. This includes overseeing the loading, transportation, and unloading of the goods.
- Financing Approval: Tech Cargo submits the trade finance proposal, including details of the cargo, to potential financiers. Financiers evaluate the proposal and approve the financing based on the cargo's value and the trade's viability.
- Cargo as Collateral: One of the unique aspects of Tech Cargo's trade finance is the use of the cargo itself as collateral. The cargo in transit serves as a valuable asset that backs the financing, reducing the need for additional collateral.
- Creation of Trade Finance Agreement:?Tech Cargo, the client, and the Founder sign the trade finance agreement allowing Tech Cargo to use the cargo as collateral on behalf of the Founder
- Funds Disbursement: Once the facility is approved, the financier pays directly to the seller and Tech Cargo takes control of the product and delivers it to the ultimate debtor. These funds can be used to cover various trade-related expenses, including the purchase of the goods, transportation costs, discount fees and any cargo risk insurance.
- Trade Completion: Tech Cargo ensures proper delivery to the ultimate debtor in the conditions expected and obtains a Proof of Delivery (POD) that serves as a transfer of title from seller to buyer.
- Repayment and Settlement: Payment conditions should be met before final delivery usually either through a bank payment guarantee or simply through a receivables purchase by the client factor where the proceeds are used to satisfy the obligations of the Purchase Order financier.
As set out in the previous steps, our logistics-based trade finance framework represents a disruptive method for the efficient management of trade transactions and for overcoming the barriers to access to credit that small businesses face.
Our approach provides the necessary funds to fuel growth and expansion by utilizing merchandise as collateral and partnering with financiers. We handle every step of the process, from initial consultation to final delivery, ensuring seamless operations and successful trade outcomes.
Say goodbye to traditional credit limitations and hello to a new era of trade finance! Take control of your finances, enhance your cash flow management, and unlock new opportunities for your business. Connect with us today and discover how logistics-based trade finance can transform your business journey.
