If your customers are concerned about the credit risks (such as non-payment, non-delivery of goods, warranty, etc.), what can you do?

We can issue different types of Guarantees or Bonds to suit your needs. A guarantee or bond states that you will comply with the terms of the contract / agreement with your customers, otherwise your customers will be compensated .

Four types of Guarantee or Bond:

• Bid Bond
• Performance Bond
• Advance Payment Guarantee or Down Payment Guarantee
• Payment Guarantee
   

What is a Standby Letter of Credit?

A Standby L/C is a guarantee to the beneficiary against defaults by the applicant in the performance of his commitment. It is often used in lieu of a performance guarantee; for example, to help another company obtain credit.

When is Forfaiting used?

When you want to eliminate the risk of the issuing bank running into financial difficulties, exchange controls or political problems in the importer's country/region, our forfaiting (non-recourse discounting for the bills under usance L/C) financing services can help. By simply providing us with the receipt of conditional acceptance and due date for the payment by the L/C issuing bank, we can provide you with liquidity so your payment is secured.

A fixed interest rate reduces your exposure to interest rate or foreign exchange risks and is another core feature of forfaiting. Except in the case of fraud or court injunction, we will not claim back the payment made to exporters.

How do you turn your accounts receivable into cash faster?

With the growing trend to use open account terms, instead of L/C, as a settlement method for international trade, Bank of China (Hong Kong) offers a flexible solution for suppliers who are eager to build favourable relationship with their customers.

Bank of China (Hong Kong), as a member of the Factors Chain International (FCI), provides one-stop Factoring Services to meet your accounts receivable needs. Subject to a pre-agreed percentage of the approved invoice value, you can turn your accounts receivable into cash, without providing additional collaterals.

Factoring also provides the following benefits:

Credit Risk Protection
We provide you with the credit risk protection for sales covered by an agreed credit line, when the buyer goes bankrupt, closes business or fails to effect payment.

Collection Services
We (or our correspondent) will remind your buyers to pay on time, thus reducing your burden of debt collection.

Flexible Financing
Payment from your buyer is treated as the 1^st source of repayment. We provide you with the services including buyer's credit assessment, credit protection, ledger management and debt collection. In addition to your existing banking facilities, we provide you with another source of financing to facilitate your cash flows.

Assessment of Buyer's Credit
In conjunction with our correspondent, we can carry out extensive credit checks on your buyers, allowing you to focus on developing your business.

For any enquiries about Factoring, please call our Trade Services Centre at +852 3988 2288 or e-mail: trade_products@bochk.com.

How do you minimize foreign exchange risks?

One of the uncertainties of international trade lies in the fluctuating exchange rates between currencies. If you are not properly protected, foreign currency fluctuations can lead to great loss. To help mitigate your foreign exchange risks, we offer you Spot / Forward Foreign Exchange services.