FCIA's Trade Payables Financing Policy provides coverage to a bank against nonpayment of trade accounts payables due from a single obligor to a single or multiple sellers of goods or services. The bank is the policy's named insured.
A possible financing structure is where a client of the bank, which is the buyer of goods and services, approaches the bank to finance the payment of its trade credit payables due to one or multiple sellers. The bank pays the sellers and creates a direct obligation to it from the buyer under a financing agreement. Benefits to buyer can include earning an early payment discount from suppliers and receiving longer term payable financing. The total term must remain within normal credit terms for the product sale. Please read the brochure for more details.
- Up to 90% coverage
- Bank is the policyholder
- Premiums payable only on actual fundings
- Non-cancelable limits during the policy period
- Minimum premium of $20,000