Buyer Credit Discounting involves the process, Where Export Credit Financial services as an entity purchases bills or documents from exporters and provides a loan after discounting the bill amount .
Typically a minimum of Tsh, Or USD 1 Million. In transactions exceeding Tsh or USD 10 Million,Export Credit Financial services usually provide credit in a co-finacing arrangement with the involvement of commercial Bank(s)
Transaction Base curency is Tsh or USD. Typically a period of 2-5 years (maximum 10 years) depending on terms amd conditions of the related commercial agreement. Tenure less than 2 years is principally available for financing agriculural or relatively small-value manufacturing industry.
Interest is fixed (Only in tenure above 2 years) or floating, based in case of USD fiancing. Its necessary to to certify the importer & Exporter origin of the product and/Or services constituting the Object Of transaction.
In the case of financing facilities offerd with tenure exceeding two years at fixed interest, under ECFS arrangement, a Max of 85% of the foreign trade/general contracting agreement may be financed. Minimum of 15% advance must be paid by the buyer at start of performance.
