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POST-SHIPMENT FINANCE : It may be defined as "any loan or advance granted or any other credit provided by a bank to an exporter of goods from India from the date of extending the credit after shipment of goods to the date of realisation of export proceeds. It includes any loan or advance granted to an exporter on consideration of or on the security of, any Duty Drawback or any cash receivables by way of incentive from the Marketing Development Fund or any other relevant While granting post-shipment finance, banks are governed by the guidelines issued by the RBI, the rules of the Foreign Exchange Dealers Association of India (FEDAI). The Trade Control and Exchange Control Regulations and the International Conventions and Codes of the International chambers of Commerce. The exporters are required to obtain credit limits suitable to their needs. The quantum of credit depends on export sales and receivables.
Post-shipment finance is granted under various methods. The exporter may choose the type of facility as per his requirement. The Banks scrutinise the documents submitted for compliance of exchange control provisions like:
i) the documents are drawn in permitted currencies and payment receivable as permitted method of payment;
ii) the relevant GRPP form duly certified by the customs is submitted and particulars as stated in the GWPP form are consistent with the documents tendered as well as the sale contract firm order etc./letter of credit;
iii) the documents are submitted within the time limit stipulated and in case of delay suitable explanation is made;
iv) the period of usually is in consonance with the time limit prescribed for realisation of export proceeds.
Let us now discuss various types of post-shipment finance.
Define international marketing and furnish its features.
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Export of Imported Goods: Goods imported may be exported in the same or substantially the same form, without a licence provided they are not under the Negative Lists. Export of su
RBI Code Number: This code number is a requirement under the Foreign Exchange Regulation Act (FERA). For obtaining the code number, the firm has to apply to the Divisional Off
FINANCIAL GUARANTEES: Exporters require adequate financial support from banks to carry out their export contracts; ECGC's guarantees protect the banks from losses on account of th
Amount: The loan amount is decided on the basis of export order and the credit rating of the exporter by the bank. Generally the amount of packing credit will not exceed FOB value
Q. Buying centre concept? Applying the buying centre concept The decision-making unit in a purchasing organisation consists of the buying centre. This is invented of the dec
OBJECTIVES After studying this unit, you should be able to: 1. Explain the objectives of exchange control; 2. Describe the principal provisions of Foreign Exchange Regula
Post purchase evaluation The EKB model was additional developed by Rice (1993) which suggested there must be a feedback loop Foxall (2005) further suggests the significance of
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