Trade Finance Windows
Under this window a results-based Trade Finance facility has been established. In this facility we work with financial institutions to develop new Trade Finance products and de-risk their introduction. Specific interventions include working with innovative Trade Finance Providers to support them in fund raising. TCA works with a range of Trade Finance providers including banks, fintechs, Development Finance Institutions, other non-banking financial institutions etc. to provide them with either first loss capital, equity participation or a grant-oriented blending facility to allow them to raise further capital aimed at providing Trade Finance to export oriented SMEs. TCA also supports communication around the products being launched to make SMEs aware of Trade Finance products available and the modalities of accessing them. They are highlighted as below:
- Support to Garments Sector: TCA works with Trade Finance institutions to provide instruments such as factoring and pre-shipment finance to improve working capital availability. It also looks to grow the availability of loan-based solutions against receivables as well as support foreign currency-based solutions through providing hedging support to reduce the cost of Trade Finance;
- Support to Horticulture Sector: TCA works with both Trade Finance Providers and horticulture sector-oriented funds to provide first loss capital to create Trade Finance solutions for SMEs.
- Provision of Trade Finance in Emerging Areas: We work to provide Trade Finance to actors that have had limited access to such working capital finance. Some of this work could include:
- Working with micro-finance institutions to support to provide financing solutions for women traders that TMA has a very strong knowledge of, and successful experience with;
- Partnering with innovative providers to structure products that have a positive conservation impact and enhance tourism;
- Partnering with insurance providers and commodity exchanges in the region to structure affordable container guarantee schemes that would remove need for container deposits and support future/forward trades.
