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A short term export financing available for exporters to fund their production of exports and raw material/ finished goods purchases in the won, so that foreign currency can be obtained through exports and the provision of services. |
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The expansion of export is inevitable to propel economic growth, improve balance of payments and realize economic self-reliance in such a country like Korea with insufficient resources but abundant human resources. The export trading needs various supports in terms of taxation and finance to promote it. The trade financing is a system supporting to strengthen international competitiveness and attain export increase by supporting funds to exporters to produce timely exports. |
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Small and Mid-sized Enterprises (SME) : Nothing to be specified.
Large corporations and others : 3 months for companies with KEB's credit rating grade 4 or higher and 1 month for others. |
| Category |
Eligibility |
Coverage |
| General Export-Import Financing |
Manufacturing exporters
Small scale exporters(less than USD 50 million a year)
International trading companies or distributors |
Production, raw material purchase(import or purchase)
A blanket financing
Finished goods purchase |
| Construction /Service Export Financing |
Construction companies and service providers
International air lines and shipping companies |
Production
Raw material purchase
Production |
| Agricultural-Fishery Export Financing |
Agricultural-fishery products storage and exporters |
Production |
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Breakdown of Trade Finance |
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Production : Manufacturing/processing of export products and R&D expenses. |
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Raw material purchase : Purchase of raw materials at home or abroad for export-oriented |
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manufacturing. |
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Finished goods purchase : Purchase finished goods at home for export. |
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Blanket financing : A packaged financing regardless of the fund usage, designed for small scale exporters whose export performance is below U$50 million a year. |
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Exporters settling export transactions in the means of Letter of credit, documentary collection based on D/P and D/A and other contracts related to exports. And companies which plan to export goods or services in either foreign currency or won. |
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Local manufacturers or companies producing or processing finished goods for export and raw materials, involving commission based processing on the basis of local letters of credit. |
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Companies wishing to get financed based on their export performance records, including Local L/C-based export sales.(Performance based financing) |
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Intermediary trading firms are excluded. |
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Eligible Export Performance |
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Own product export : Involves exporting or domestic supplying to trading firms. |
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Other companies' product export : Involves purchasing finished goods under Local L/C or in cash and exporting |
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Trade Finance Limit and Term |
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| Category |
Limit |
Term |
| Based on L/C |
Within the amount of Export L/C |
Within 270 days (within L/C expiry dates) |
| based on performance results |
Production fund |
Export Performance results for the last one year * earning rate |
Within 180 days |
| Low material fund |
Export Performance results for the last one year * dependence rate |
Within 180 days |
Finished goods fund
Construction/
Service export |
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Other companies export performance results for last one year * 1/4 |
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Other companies export performance results for last 6 months * 1/2 |
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Within 3 days
(including based on L/C) |
| Blanket finance |
Export Performance results for the last one year |
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Within 270 days based on L/C |
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Within 180 days based on performance results |
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Aggregate limitation loan : Basic rate of aggregate limitation loan + additional rate |
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Loan*except aggregate limitation loan : Basic rate linked to market interest rate + additional rate or Prime rate of loans in Won + additional rate |
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Loan except aggregate limitation loan is applicable to companies either with lower credit rating or over aggregate limitation loan. |
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Amount to finance (Actual loan amount) |
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Production fund: Financing limit of foreign currency amount ¡¿ average earning rate ¡¿ average buying and selling basis rate |
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Raw material fund: Import bills (notes), Foreign currency amount on a local L/C ¡¿ average buying and selling basis rate |
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Finished goods purchasing funds: Foreign currency amount on a local L/C ¡¿ average buying and selling basis rate |
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Blanket financing: Limit amount (L/C amount) ¡¿ average buying and selling basis rate |
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The financing amount is rounded off to the unit of KRW 100,000 |
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Eligibility for Blanket Financing |
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Target exporters: exporters whose export record stood less than USD 50 million for the preceding fiscal year or in the 12-month period prior to the month in which an exporter applied for the financing. Any exporter that is less than a year old is also entitled to applying for this packaged loan. |
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Advantage : The Blanket Financing facility enables exporters to fund a variety of export-related activities such as raw materials purchase and manufacturing/processing under an umbrella loan, making the access to the financing easy for exporters who meet other requirements. |
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