Trade finance that pays your suppliers so your stock keeps moving.

Trade finance pays your supplier for stock or goods when they are ordered or shipped, and you repay the financier once the goods are sold, usually within 30 to 180 days. It bridges the gap between paying for stock and being paid by your customers, so you can take larger orders without tying up cash. Facilities can cover local purchase orders as well as imports, and payments can be made in foreign currency. Interest and fees are charged on each drawdown for the days it is outstanding.

Trade finance funds the purchase side of the cycle, paying suppliers before goods arrive or sell. Invoice finance funds the sales side, advancing cash against invoices you have already issued. Many wholesalers and importers use both together: trade finance pays the supplier, the goods are sold, and invoice finance releases cash from the resulting invoices to repay the trade facility. Your broker checks that the two lenders’ security interests are compatible before setting both up.

Trade finance is usually priced as an establishment fee, a fee or interest charge per drawdown calculated on the amount and the number of days until repayment, and sometimes a facility line fee. Foreign currency payments may also carry a conversion margin. Because each drawdown is short, comparing the all-in cost per $10,000 over your typical 60 or 90 day cycle is clearer than comparing headline rates. Lyft Money sets this out for each lender before you commit.

Trade finance suits established importers, wholesalers, distributors and manufacturers with a track record of buying and selling stock, typically 12 months or more of trading and turnover in the hundreds of thousands or above. Lenders look at your sales history, the reliability of your suppliers and customers, and the margin on the goods. Service businesses with no stock and one-off buyers are generally not a fit. Security can be the goods themselves, receivables or a general security agreement.

Yes. Most trade finance lenders can pay suppliers in US dollars, euro, yuan and other major currencies, either directly or through a letter of credit, and some let you lock in an exchange rate at drawdown so the landed cost of the goods is known. The currency margin is part of the cost to compare. If you already use a foreign exchange provider, your broker checks whether the lender can work alongside it.

Each drawdown is usually repayable within 30 to 180 days, matched to how long it takes for the goods to arrive and sell. Some lenders allow up to 120 or 180 days for imports with long shipping times, and shorter terms for local purchase orders. You can have multiple drawdowns running at once up to the facility limit, each with its own due date. Repaying from sales proceeds or from an invoice finance facility keeps the cycle turning.

Establishing a facility typically takes one to three weeks, because the lender reviews your trading history, suppliers and customers and sets a limit. Once it is in place, individual supplier payments are usually made within 24 to 48 hours of your request. If you have an order waiting, tell your broker the supplier’s payment deadline so the setup can be prioritised.

A letter of credit is a bank guarantee to your supplier that payment will be made once agreed shipping documents are presented. Overseas suppliers sometimes require one for new customers or large orders. Trade finance can be arranged with or without letters of credit; many lenders simply pay the supplier directly on your instruction, which is faster and cheaper. Your broker matches the facility to what your suppliers actually require.

Yes. Many CNC machines are built to order overseas and need a deposit at order and the balance before shipping. Lenders can fund the supplier’s progress payments and convert the whole amount to a chattel mortgage when the machine is installed and commissioned, or a trade finance facility covers the purchase until delivery. Tell your broker the payment schedule early so the structure is in place before the deposit is due.

Yes. Progress payments to the manufacturer can be funded by the lender or through a trade finance facility and rolled into a chattel mortgage when the machine is installed and commissioned. Tell your broker the payment schedule so the structure is ready before the deposit is due.