COLUMBIAtrading

Solution 01

Trade finance

The set of instruments that funds the operation, mitigates counterparty risk and protects margin against FX. Choosing the right instrument is usually worth more than chasing the lowest rate.

The problem

Two risks, one gap

In international trade, payment and delivery almost never coincide. Weeks or months pass between invoice, shipment, clearance and settlement — and that gap is where an operation makes or loses money.

Counterparty risk

The exporter ships before being paid; the importer pays before receiving goods. Guarantee instruments — letters of credit, SBLC, documentary collection — move that risk to a financial institution.

FX risk

Between contract and settlement the rate moves. Without a hedge, the margin negotiated in the spreadsheet is not the margin realised in the results.

The gap

Where cash sits exposed

Payment and delivery rarely happen at the same time. Between invoice, shipment, customs clearance and settlement, your capital is idle — and exposed to FX.

  1. 01

    Order and contract

    Supplier negotiation

  2. 02

    Shipment

    Document issuance

  3. 03

    Transit

    International freight

  4. 04

    Customs clearance

    Duties and taxes

  5. 05

    Sale and collection

    Inventory turnover

Exposed cash

Counterparty risk and FX risk

Columbia finances this gap

FINIMP, ACC/ACE, export credit, LC, NDF

Instruments

Choose by the problem, not by the product

Select what you need to solve. Each instrument carries its own tenor, currency, documentary burden and total cost — and the cheapest is rarely the most suitable.

Foreign-currency funding contracted outside Brazil

FINIMPImport

Import financing

When to use it
Extend payment terms to the foreign supplier without consuming your own cash.
What it protects
Working capital during transit and customs clearance.
PPEExport

Export pre-payment

When to use it
Receive foreign currency up front against firm export contracts.
What it protects
Cash flow before shipment.
4131Import and export

Cross-border loan (Law 4.131)

When to use it
Raise funding directly from an offshore bank in foreign currency.
What it protects
Funding cost on longer-tenor operations.

The right instrument beats the lowest rate

Companies commonly hunt the cheapest facility before mapping tenor, currency and the quality of the payer. In well-structured operations total cost falls because the instrument was chosen while designing the contract — not after shipment.

Is your operation financed the right way?

Bring a concrete case — product, origin, tenor and volume. We'll come back with the financial and operational structure that fits.

Talk to Columbia