Trust Receipt Financing

Trust Receipt Financing

An arrangement in which CB Bank advances to buy of settlement of bills drawn on the buyer for good purchased, but the Bank is the legal owner of goods. It allows the release of goods to the buyer in trust against its undertaking to sell and pay the Bank with the proceeds.

FEATURES AND BENEFITS
Role of CB Bank :

Financing Bank and Trade service product provider
Tenor : Up to 180 days (subject to review from CB Bank)
Benefits to Importer (Buyer)

  • Do not need to pay immediately from own cash holdings as goods have not been sold when documents are presented under documentary credit or documentary collection

  • Financing can be up to 100% of the documentary credit and documentary collection, subject to approved trade facility credit limit

  • Enjoy credit terms pre-approved by the Bank.

  • Buyer’s working capital or cash flow is not tied up and can be deployed for other business purposes.
Process

  • CB Bank notifies the importer (buyer) when the trade documents have been received from the Negotiating Bank.

  • Upon full compliance with terms and conditions of the LC, CB Bank would initiate the payment within 5 business days.

  • The importer may take TR (Trust Receipt) Financing from the CB Bank for LC amount up to 180 days with standard banking charges with interest (subject to review from CB Bank).

  • The importer can collect the trade documents from CB Bank to clear the goods from the Shipping Company.

  • Importer (buyer) will pay back to CB Bank when the loan term is due.
RATES AND FEES (SUBJECT TO CHANGES)

Pre-arranged fees & charges
REQUIREMENTS

  • The B/L or Air waybill will have to be in favour of CB Bank or endorsed in favour of CB Bank

  • Trust Receipt Application Form

  • Request Cover Letter with Company Letterhead

  • Sales contract

  • Commercial invoice

  • Shipping documents (Bill of Lading / Air waybill / Packing List / Certificate of Origin / Insurance)