International Trade Finance An Overview

Easy Explanation of International Trade Payment Methods like LC, Collections, BG etc and Incoterms 2020

Last updated 2022-01-10 | 4.2

- Get an overview of trade finance and understand roles of various related parties
- Understand the payment methods used in international trade and Pros and Cons of each payment method
- Crystal clear concepts of process flow of complex methods like letter of credit
- bank guarantee and collections

What you'll learn

Get an overview of trade finance and understand roles of various related parties

Understand the payment methods used in international trade and Pros and Cons of each payment method

Crystal clear concepts of process flow of complex methods like letter of credit

bank guarantee and collections

Get an overview of Incoterms 2020

* Requirements

* No prerequisites

Description

Are you confused about the different payment methods used in international trade finance?

Confused about what is the need of so many types of payment methods - letter of credit, collections, bank guarantee? What is the difference between these and when is each method used?

Want to know what are the most commonly used trade documents? How do those look like?

Understand what is meant by Incoterms? What is its need? How is it used in international trade?

Then you are in the right place!! Welcome to the course on International Trade Finance - An Overview

What will you get out of this course?

Be confident to face interview questions for trade finance desk operations
Be confident with the complex flows of documents and money in letter of credit, collections etc
Crystal clear concepts of terms/jargons used in relation to international trade finance
Know how the commonly used trade documents look like and the important fields
Evaluate your understanding with quiz and practice test

Who is this course for?

Business Analysts and Consultants of International Trade Finance
Businessmen in the Export-Import domain who want to understand the payment methods available to them
Bankers
Students in International Trade
Employees in Trading Organizations

Why should you enroll to this course?

The course gives an overview of the world of trade finance before going into the details of the various payment methods used in international trade. It explains the detailed process flow of complex payment methods like collections, letter of credit, escrow account, and bank guarantees.

Special care has been taken to ensure that all the explanations are simple and lucid so that anyone without any background in finance can understand.

Invest just one hour in this course and be assured that you will get a solid knowledge base and you will be more confident to go into in-depth understandings in international trade finance.

What this course covers?

What is Trade Finance and who are the Parties Involved
Methods of Payment in International Trade - Overview
Documentary Collection - Detailed Process Flow and Related Knowhow
Letter of Credit - Detailed Process Flow and Related Knowhow
Types of Letter of Credit
Bank Guarantees - Detailed Process Flow and Related Knowhow
Letter of Credit and Bank Guarantee - A Comparison
Samples of Real-life trade documents and the important fields in those documents.
Overview of Incoterms 2020
Quiz and Evaluation Test

Who this course is for:

Business Analysts and Consultants of Trade Finance
Bankers
Businessmen in Export-Import Domain
Employees of Trading Organizations
CITF Aspirants and Students of International Trade

Course content

11 sections • 41 lectures

International Trade Finance - The Gist 3 lectures

What is this course about? Preview 01:17

A Gist of the world of International Trade Finance Preview 08:41

Knowledge Bite - Understanding Risks in Trade Finance Preview 03:00

You will have a brief idea of the risks associated with finance of international trade

Methods of Payment in International Trade 5 lectures

Classification of Payment Methods and Factors which determine the choice Preview 02:05

Advance Payment and Open Account Methods Preview 01:53

Escrow Account Method Preview 01:38

Documentary Collections and Avalisation/Banker's Acceptance Methods Preview 02:31

Deferred Payment Undertakings and Bank Guarantees Preview 00:54

Documentary Collections Method 7 lectures

Roles/ Parties in Documentary Collections Method Preview 01:22

Process Flow of Documentary Collections - Sight and Usance Preview 03:28

Categories of Documents and Types of Collections Preview 00:42

What is a Collection Instruction prepared by banks? Preview 01:41

Responsibilities in the Export/Outward Collection Desk of a Bank Preview 01:31

Responsibilities in the Import/Inward Collection Desk of a Bank Preview 01:05

Import Bills under Collection - Job Set Up Preview 00:55

Letter of Credit 6 lectures

Understanding the Definition of a Letter of Credit Preview 02:50

Process Flow And Roles of Banks Involved (Advising, Negotiating, Reimbursing) Preview 05:42

Vital Points about LCs Preview 02:47

Differences among Discounting, Purchase and Negotiation Preview 06:44

This lecture explains the differences between discounting, purchase, and negotiation of bills. We will also learn the meaning of some other commonly used terms in LC handling.

Deriving Discounted Value of Bills

Understanding calculation of discounted value of bills by banks. Solution to the case study is provided at the end.

Quick Summary - Balance of Risk Between Buyer and Seller Preview 00:05

Types of Letters of Credit 6 lectures

Classification of Letters of Credit Preview 02:47

Confirmed and Unconfirmed LC - The Difference Preview 01:19

Red Clause LC and Green Clause LC - Uses Preview 01:29

A Revolving Credit - Uses and Types Preview 02:37

Transferable LCs - Process Flow Preview 02:45

Back to Back LC - Process Flow Preview 02:27

Bank Guarantees 4 lectures

Bank Guarantee - Definition and Process Flow Preview 06:18

Types of BGs - Depending on Nature and Purposes Preview 03:15

Advantages of a Bank Guarantee Preview 01:52

Validity of the BG Limit Vs Validity of an individual BG Preview 02:22

Letter of Credit and Bank Guarantee - A Comparison 1 lectures

Letter of Credit Vs Bank Guarantee Preview 04:39

Samples of Real life trade documents and the important fields 1 lectures

Invoices/Certificates/Transport Docs/Insurance Preview 07:25

Incoterms® - The Basis of International Trade 2 lectures

Incoterms® 2020 Overview Preview 18:26

Incoterms

Case Studies - Test Yourself 4 lectures

Assignment 1

ABC Tea Company is an exporter of tea from India. XYZ Tea Dealers is an importer of tea in the USA. Please read the following scenario carefully -

Assignment 2

XYZ Research Laboratories located in London supplies various medical instruments throughout the world.

Assignment 3

XYZ Textiles India Pvt Ltd is a textile exporter in India. ABC Garments is a readymade garment manufacturer located in Bangladesh. Please read the following situation carefully -