Introduction
Bill purchase refers to the service that Bank of China discounts bank draft under clean collection and other settlement transaction without trade documents in order to offer financing service to customers.
Functions
The product is used to meet the short-term financing requirement for exporter under clean collection.
Features
1. Improvement of liquidity. The product can convert forward receivables into cash on demand so as to accelerate capital turnover and relieve the pressure of finance.
2. Simplification of financing process.
Target Customers
1. Customers lack liquidity who want to develop business relying on fast capital turnover.
2. Customers who come across temporary difficulties in capital turnover before proceeds collected under clean collection.
3. Customers get a new investment opportunity by financing under clean collection, and the anticipated yield is higher than discount rate.
Interest Rates
Financing interest rate shall be in accordance with the interest rate of trade finance business applied by of Bank of China.
Application Qualifications
I. Basic qualifications
1. The business license of enterprises legally approved, registered and annually checked and other valid certifications sufficient to prove the legitimacy and scope of its operation;
2. Loan cards;
3. The account opening permit and a settlement account with Bank of China;
II. Others
1. Customers have demand draft for payment issued by other bank;
2. Occupation of paying bank's credit line
Process
1. Customers submit to Bank of China the bills and applications for relevant business;
2. Bank of China shall check the documents, then process payment to customer and retain rights of recourse;
3. Bank of China claims for payment by sending out the bills to the overseas paying bank;
4. The overseas bank makes payment to Bank of China when due, with which Bank of China repays the discount loan.
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