The principals of Cross Border Financial Services Ltd. are expert forfaiting finance professionals and work effectively with all leading trade credit insurance underwriters.
TRADE CREDIT INSURANCE
Trade credit insurance is available from public and private sector underwriters.
Generally such insurance covers non-payment risk due to commercial events (insolvency and failure to pay) and/or political events (currency inconvertibility, cancellation of import license, political violence, trade embargo, etc.)
With an effective trade credit insurance program companies can:
Define the amount of risk compatible with corporate objectives and use that risk to obtain competitive advantages
Expand sales opportunities and enter new markets by offering expanded account credit terms
Access financing, especially for export receivables
Manage risk more effectively through communication with the underwriters and their extensive databases on customers and markets
MEDIUM TERM INSURANCE
Cross Border Financial Services Ltd. has been able to arrange medium-term financing through the use of medium term credit insurance provided by public and private market underwriters.
Generally, medium-term is defined as having a term greater than one-year and less than five years, but some markets may occasionally cover risks to 10 years.
INTERNATIONAL TRADE FINANCE
We have substantial experience in structuring and arranging the following types of financing for our clients:
Purchase order & receivable financing
Non-recourse sale of notes
Forfaiting of medium-term notes
Cross-border lease financing
Medium-term financing for capital goods
Intl. customer financing programs
TRADE CREDIT INSURANCE
Cross Border Financial Services Ltd. assists the exporter in financing their working capital needs using a variety of products and techniques:
Export-Import Bank Working Capital Guarantees
Lines of credit for insured accounts receivable
Off balance sheet limited recourse note purchase facilities
Because Cross Border Financial Services CBFS constantly reviews trade finance options with exporters and financial institutions, we are often in a position to help an exporter obtain the most flexible terms at the lowest cost. By allowing Cross Border Financial Services Ltd. to arrange export financing, companies can use their limited resources to generate sales and profits.
For medium term sales (generally one to five years) we can work either with the exporter or directly with the foreign buyer to provide financing.
POLITICAL RISK INSURANCE
Political risk insurance is used by equity investors and financing entities to mitigate the effects of certain political events on investments and financing activities in foreign markets. While political risk is a broad topic, insurance coverages are very specific.
Cross Border Financial Services CBFSUK helps clients design a political risk program that provides forfaiting coverage against specifically identified risks such as the ones outlined below:
Confiscation, Expropriation, Nationalization (CEN): Generally protects investors and lenders from action by the host government that limit basic rights of owners & creditors in the insured investment or loan.
These actions can either be direct, such as nationalization, confiscation or they can be gradual (creeping expropriation).
Currency Inconvertibility/Transfer Risk: Protects against the inability to convert local currency into foreign currency and transfer it out of the host country.
Often times this coverage is combined with CEN coverage, but can occasionally be arranged separately.
Contract Frustration: Protects against loss due to non-payment of a contractual obligation by a public (government owned) buyer and a private buyer's inability to make payments due to certain political events in the host country. May also protect insured from financial losses due to other specific contractual defaults by a public entity.
CREDIT APPROVAL NON RECOURSE FINANCING
Typically, Cross Border Financial Services CBFSUK. can work to obtain credit approval for the buyer and arrange non-recourse financing for the exporter. The result is a cash sale for the exporter and low-cost term forfaiting financing for the buyer.
War and Political Violence: Coverage against loss or damage to property and interruption of debt service caused by specific events such as war, terrorism, etc.
Non-Repossession: Protects the insured's rights to repossess and re-export assets including mobile equipment. Insures against actions by the host government to prevent the insured from exercising those rights.
Other: There are a variety of other coverages including "unfair calling of bonds", protection against loss due to trade embargoes and license cancellations.