Executive Overview of Trade Finance by Oxford Credit Banque Limited (OCB)

Oxford Credit Banque ’s study explores the structure and recent developments in the global market for trade finance and the interplay between trade finance and foreign trade shifts. In particular, it measures the size and evolution of the market, sheds light on the performance and effect of trade finance during recent episodes of global market funding stresses, and looks at how ongoing structural changes can impact the potential resilience of the market. The primary results are: The function of bank-intermediated Trade finance Two important roles are performed by bank-intermediated trade finance (or trade finance, in short): providing working capital linked to and in support of foreign trade transactions and/or providing means to reduce the cost of payment. Inter-firm trade credit is the primary alternative to bank-intermediated goods. The ability of companies to lend credit directly is enabled by the ability to discount their receivables and the availability of f...