Affin Bank

Trade Financing We are well equipped with trained, experienced resources and systems to manage trade related transactions. Our range of import & export related products and services amongst others, includes the following:Letters Of Credit
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Commercial LC Red Clause LC Transferable LC Back to Back LC Revolving LC Standby LC

Import
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Trust Receipt (TR) Bankers Acceptance (BA) Purchase Shipping Guarantee Import under Documentary Collections

Export
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Bankers Acceptance (BA) Sales Bill Purchase/Discounting Bill Negotiation Export Credit Refinancing Export under Documentary Collections

Guarantees
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Tender/Bid Guarantee Performance Guarantee Advance Payment Guarantee Security Deposit Guarantee

Bank Islam
Accepted Bills-i (AB-i) An AB-i can be drawn to finance domestic purchases or imports and domestic sales or exports. AB-i (Purchase) is a financing facility using the Murabahah contract, granted to the buyer or importer to finance their purchase of tradable goods that include raw materials, semi-finished and finished goods. Payments to suppliers will be made immediately by Bank Islam, and customer may match the deferred payment according to the aging of credit terms. Using this facility:
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Bank Islam appoints the customer as its agent to purchase goods on its behalf Upon delivery of goods, Bank Islam pays the supplier at sight or upon maturity of credit term for the cost of the goods based on the invoice value Bank Islam will subsequently sell the goods to the customer on deferred payment terms at a price inclusive of the Bank’s profit The deferred payment term on sale of goods granted to the customer, constitute creation of a debt. This is securitised in the form of AB-i drawn by Bank Islam Upon maturity, the customer pays Bank Islam the agreed sale price of the financing

AB-i (Sales) is a financing facility using the Bai´ Dayn contract, granted to the seller or exporter to finance their sales or export of goods on credit terms that include raw materials, semi-finished and finished goods. Bai´ Dayn or debt trading is a short-term financing facility whereby Bank Islam purchases the customer’s right to the debt, which is normally securitised in the form of Accepted Bills. Using this facility:
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The seller/exporter who wishes to avail himself of this facility, prepares sales/export documents as required under the sale of contract Seller/Exporter presents these documents to Bank Islam to be purchase> As the sales/export documents have to be sent to the buyer, Bank Islam requests the seller/exporter to draw the AB-i drawn on Bank Islam Bank Islam will purchase the debts and credit the proceeds to the seller/exporter Upon receiving payment from its buyer, seller/exporter will use it to settle the AB-i

BENEFITS
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Provide up to 100% financing of invoice value Improves customer’s cash flow as sales proceeds are received immediately while payment is made only upon maturity of AB-i

Bank Islam will take the responsibility to honour the beneficiary’s claims All BG-i must have specific expiry date and claims period o BG to cover government contracts o BG in respect of contracts for a specified period BENEFITS  BG-i is widely accepted. in case the customer defaults in fulfilling his obligation. BPA consists of 2 important elements:   The undertaking of sovereign risks by the Central Banks to facilitate settlement of monetary obligations among commercial banks in both countries arising from trade The undertaking by the Central Banks of both countries to settle the net balance arising from the trade conducted between the two countries FEATURES     Periodic settlement of net balance between signatory Central Banks Central Banks grant net credit limit to each other Letters of Credit (LCs) must be marked with special reimbursement clause Trade transactions are carried out through the existing financial or banking system BENEFITS    Guaranteed payments in domestic currency for exports and elimination of the credit risk and exchange risk Greater confidence to trade with developing countries Easier access to banking facilities . In the event the customer defaults in performing his obligations. thus giving the beneficiary more confidence. BG-i is not a financing instrument. BG-i is Bank Islam’s irrevocable undertaking to guarantee performance or financial standing of a customer. Bilateral Payments Arrangment (BPA) BPA is a scheme for the settlement of net monetary obligations arising from trade between pairs of countries. FEATURES   Bank Islam acts as a guarantor.Bank Guarantee-i (BG-i) BG-i is an irrevocable written obligation issued by Bank Islam to pay an agreed sum. Issued under the Kafalah contract.

DOMESTIC BILLS OF EXCHANGE PURCHASED-i (DBEP-i) Domestic bills drawn in RM purchased by Bank Islam against outward bills for collection under open account or against letter of credit. granted by Bank Islam to its customer whereby Bank Islam purchases the customers’ debts arising from the creation of the outward bills for collection under open account or drawn against export letter of credit.Bills of Exchange Purchased-i (BEP-i) A financing facility using Bai´ Dayn contract. BEP-i is classified into two: 1. the financing period shall not exceed 60 days. For sight term. It is an effort to encourage the exports of Malaysian agriculture products and manufactured goods. The customer’s account is credited immediately with the proceeds from the purchasing of the debt. available to direct exporter who exports eligible products on sight or usance terms. 2. . The proceeds of the collection will be used to liquidate the financing. BENEFITS    Margin of finance up to 100% of the invoice amount Able to improve cash flow by obtaining immediate funds as a mean of financing for working capital requirement Simple document preparation Export Credit Refinancing-i (ECR-i) ECR-I(Pre-shipment) Pre-Shipment ECR-i is a financing facility based on Murabahah contract. ECR-I(Post-shipment) Post-shipment ECR-i is a financing facility based on Bai´ Dayn contract. FOREIGN BILLS OF EXCHANGE PURCHASED-i (FBEP-i) Foreign bills drawn in foreign currencies purchased by Bank Islam against outward bills for collection under open account or against export letter of credit. granted to exporters to prepare goods prior to shipment.

The Letter of Credit can be issued under Wakalah contract (agency relationship) and thereafter the goods purchased maybe financed under the Murabahah contract (cost plus). provided that the Seller/Beneficiary complies with the terms and conditions of the Letter of Credit.FEATURES      The facility is funded by Export Import Bank of Malaysia Berhad (EXIM Bank) Financing only covers Halal products and those not listed in the EXIM Bank’s Negative List Guideline The Financing rate shall be determined by EXIM Bank from time to time Bank Islam can add up to a maximum margin of 1% to the ECR Financing rate for financing its customer Post-shipment ECR-i is only available to direct exporter who export eligible products on sight or usance terms BENEFITS   Lower cost of financing as it is funded by EXIM Bank For Post-shipment ECR-i. customer can obtain immediate funds upon presentation of export documents after shipment Letter of Credit-i (LC-i) A written undertaking by Bank Islam at the request of the Buyer/Applicant to pay the Seller/Beneficiary a certain sum of money as stipulated in the Letter of Credit. WAKALAH CONTRACT    Bank Islam is appointed to act as an agent on behalf of the Buyer/Applicant Buyer/Applicant will place deposit to the full amount of goods to be purchased Bank Islam establishes the Letter of Credit and remits the payment to the Seller/Beneficiary utilising the customers’ deposit MURABAHAH CONTRACT     Bank Islam will act as the financier for the Buyer/Applicant for the purchase of the goods Bank Islam will establish the Letter of Credit and remit the payment to the Seller/Beneficiary utilising its own funds Bank Islam sell the goods to the Buyer/Applicant at a sale price comprising its cost and a profit margin Buyer/Applicant is given a deferred payment term for the settlement of the purchase .

who had placed or deposited his goods with the shipping company. Murabahah refers to the sales of goods at a price.BENEFITS    No ‘transit interest’ charges as Bank Islam remits payment to the Seller/Beneficiary only upon receipt of documents No other hidden costs Efficient payment arrangement Shipping Guarantee-i (SG-i) Shipping Guarantee is a facility where Bank Islam indemnifies and guarantees the shipping company for the release of goods to the buyer/importer without the presentation of the original Bill of Lading. Issued under the Kafalah contract. whereby any subsequent claim by the owner for his goods must be met by the guarantor. it can be defined as a surety provided by a party to the owner of the goods. Bank Islam pays the supplier at sight or upon maturity of credit term for the cost of goods based on the invoice value Bank Islam subsequently sells the goods to the customer on deferred payment terms at a price inclusive of the Bank’s profit Customer will undertake to settle the selling price on the maturity date BENEFITS  Enables the customer to settle payment obligation to the seller . This contract allows the customer to take delivery of the goods immediately on arrival and settle with the Bank on a deferred payment arrangement. BENEFITS    Importer can take delivery of goods immediately Importer will not have to incur demurrage and warehousing charges Enables the importer to sell the goods without delay Trade Working Capital Financing-i (TWCF-i) A financing facility under the Murabahah contract. to finance domestic or international trade documents against Letter of Credit or Inward Bills for Collection. which includes cost plus profit as agreed by both seller and the buyer. Using this facility:     Bank Islam purchases or appoints the customer as its agent to purchase the goods on its behalf Upon delivery of goods.

15% per month or part thereof Minimum RM50 RM50 flat Type Of Charges Amount Handling Charges (for LC issuance free of commission) ii) Special Credit (Standby.1% to 0. Back to Back.15% per month or part thereof Minimum RM50 Between 0.1% to 0. since the selling price will not be affected by fluctuation in the Base Financing Rate Provide up to 100% financing of invoice value Bank Muamalat Import Transaction 1) Outward Documentary Credit Issuance of DC i) Irrevocable DC Issuance Commission As spelt out in the Letter of Offer normally between 0.2% per month or part thereof Minimum RM100 Amendments of DC i) Amount Increase Amendment Commission Between 0.15% to 0. Red Clause) Issuance Commission As spelt out in the Letter of Offer normally between 0.1% to 0.15% per month or part thereof Minimum RM50 ii) Validity Date Extended Amendment Commission . Transferable. Revolving.   Facilitates convenient cash flow management of a business by having a fixed rate financing nature As a prudent and reliable basis in the preparation of the business projection.

Minimum equivalent of RM100 Handling Charges .1% per month or part thereof on the negotiation amount from the expiry date to the date of receipt of documents.15% per month or part thereof from DC expiry date to the expiry date of the usance bill Minimum RM50 RM50 Advising own DC direct to Beneficiary Direct presentation of DC documents from beneficiary Commission Commission 0.1% to 0.iii) Other Amendment Usance Bill Under DC Amendment Commission Usance Commission RM50 0.1% flat Minimum RM50 Maximum RM100 RM50 RM50 Checking Fee Cancellation of DC (prior to expiry date) DC Negotiation i) Negotiation charges ii) Reimbursement charges iii) Checking fee iv) Agent's Charges on DC Negotiation v) Discrepancy fee (less from proceeds) vi) Drawing After Expiry Date (less from proceeds) Commission Commission Checking Fee Agent Charges Handling Charges No Charges No Charges No Charges Actual charges claimed by agent RM50 (local DC) USD50 or equivalent (foreign DC) 0.

1% of invoice value or as spelt out in the Letter of Offer Minimum RM50 If the SG is not returned after 3 month from the date of issuance.vii) Drawing Exceeds DC Amount (less from proceeds) 0.1% of invoice value Minimum RM50 Maximum RM100 RM50 ii) Foreign Bill Collection Commission iii) Document Release Free of Payment iv) Document Redirect to Handling Charges Commission 0.1% per month or part thereof on the overdrawn amount from the DC issue date to the date of receipt of documents. additional 0.1% of invoice value Minimum RM50 Maximum RM500 0.1% of invoice value .5% per annum will be charged and subsequently 3 months thereafter until the return of the SG 3) Inward Bills for Collection (DIBC/FIBC) i) Domestic Bill Collection Commission 0. Minimum equivalent of RM100 Endorsement of Bill of Lading and Airway Bill i) Advance Set (BL) ii) Airway Bill 2) Shipping Guarantee Handling Charges Handling Charges Commission RM100 RM100 0.

Rate of Commission is based on the approval as stated in each Letter of Offer. Minimum RM200 Rate of Commission is based on the approval as stated in each Letter of Offer.15% per month or part thereof Minimum RM50 Issuance of BG (Ad-hoc Cash Margin) Commission Rate of Commission is based on the approval as stated in each Letter of Offer normally 0. RM50 Renewal of BG Commission Extension of BG Commission Cancellation of BG (prior to expiry) Amendment of BG Handling Charges .15% per month or part thereof.1% to 0.Another Bank Minimum RM50 Maximum RM500 (domestic) Maximum RM100 (foreign) Handling Charges RM50 RM50 RM200 plus legal expenses v) Dishonoured Bill vi) Protest Bill 4) Bank Guarantee Issuance of BG Handling Charges Handling Charges Commission Rate of Commission is based on the approval as stated in each Letter of Offer normally between 0.

2% on DC transferred amount Minimum RM100 RM 100 ii) Amendment to Transferred DC Commission .2% per month or part there of depending on the country/sovereign risk.i) Amount Increase Amendment Commission Rate of Commission is based on the approval as stated in each Letter of Offer. ii) Validity Date Extended Amendment Commission Export Transaction 1) Inward Documentary Credit i) Advising ii) Amendment iii) Confirmation of Inward DC Commission Commission Confirmation Commission RM 50 RM 50 Between 0.15% to 0.15% to 0. Minimum RM100 Type Of Charges Amount iv) Usance DC Confirmed Commission 2) Inward Transferable DC i) Advice of Transfer Commission Between 0. Rate of Commission is based on the approval as stated in each LOO. Minimum RM100 Additional 0.15% to 0.2% per month or part thereof from the DC expiry date to the expiry date of the usance bill.

iii) Document Handling under Transferred DC iv) Document Checking Fee 3) Bill Purchased (DBEP/FBEP (AP)/Doc) i) Domestic Bill Purchased Handling Charges RM 100 Checking Fee RM50 Profit Rate As spelt out in the Letter of Offer (spread + BFR) 0.1% flat Minimum RM50 Maximum RM100 0.1% flat Minimum RM50 Maximum RM100 RM50 Commission ii) Foreign Bill Purchased Funding Rate iii) Checking Fee for Document Drawn under LC Commission Checking Fee 4) Outward Bills for Collection (DOBC/FOBC) i) Domestic Bill Commission 0.Islamic Funding Rate Acceptance Commission .1% flat Minimum RM50 Maximum RM500 As determined by Treasury (interbank offered rate) 0.1% flat Minimum RM50 Maximum RM100 Based on money market rate for the specified tenor – determined by Treasury As spelt out in the Letter of Offer ii) Foreign Bill Commission 5) Accepted Bills .

1% of invoice value Minimum RM100 Maximum RM500 RM 50 3) Handling of Volumeness Documents (Bunching of Invoices and Multiple Payments exceeding 5 invoices and 5 payment per transaction) 4) Compensation for Late Payment Handling Charges Compensation Charges At Islamic Money Market Rate (IMMR) on the number of days RM 50 5) Overdue Bill Handling Charges Handling Charges .6) Murabahah Working Capital Financing (MWCF) 7) Bai Al Dayn Working Capital Financing (BWCF) Others Transaction 1) Direct Presentation of Documents (not under DC or Collection) Profit Rate As spelt out in the Letter of Offer (spread + BFR) As spelt out in the Letter of Offer (spread + BFR) Profit Rate Type Of Charges Commission in lieu of Collection Amount 0.1% on the amount financed Minimum RM50 Maximum RM500 (local bill) Maximum RM100 (foreign bill) 2) Commission in lieu of Forex (Export Proceeds Not Converted to Ringgit Malaysia) i) Credit to Own FCA Account with the Bank ii) Remit to FCA account with other Banks Commission in lieu of Forex Commission No Charge Commission 0.

Debit/Credit Advices 7) Cable / SWIFT i) DC Issue / DC Amendment ii) Others iii) FOT Charges (less from proceeds) 8) Letter of Indemnity on i) Bank Guarantee ii) Shipping Guarantee iii) Documentary Credit (parcel/courier receipt) iv) BL / AWB Endorsement v) Fax Application 9) Application Request/ Financing Document i) Documentary Credit ii) Letter of Hypothecation iii) DC Murabahah Contract Note iv) Al Murabahah Contract Note v) Murabahah Working Capital Financing Letter Handling Charges RM 5.00 per request Charges RM 60 Charges Charges RM 30 USD 20.6) Reproducing of Statement.00 or RM70 equivalent Stamp Duty Stamp Duty Stamp Duty RM 10 RM 10 RM 10 Stamp Duty Stamp Duty RM 10 RM 10 Stamp Duty Stamp Duty Stamp Duty RM 10 RM 10 RM 10 Stamp Duty RM 10 Stamp Duty RM 10 .

vi) Bai Al Dayn Contract Note vii) Shipping Guarantee viii) Letter of Authorization (Bank Guarantee) ix) Original Bank Guarantee 10) Sending of Documents At Customer's Request Stamp Duty RM 10 Stamp Duty Stamp Duty RM 10 RM 10 Stamp Duty Courier Charges Handling Charges (inclusive of postage. we are your partners in fulfilling your needs whether it is to finance your trade or to expand it. . At Hong Leong Bank Trade Services. scanning) RM 10 Actual Courier Charges RM 10 11) On Line Credit to Beneficiary's Account Handling Charges RM 5 Hong Leong Bank Trade Services Hong Leong Bank Trade Services with its worldwide network of agent banks has the capability to fulfill your needs to reach the global market. facsimile. Hong Leong Bank's Trade Services enables you to transact your international payments right at your doorstep. We can offer advice on a wide range of trade products to assist your trade activities. email. This will help you to minimise the risks associated with the payment for your imports/purchases. Our Trade Services Centres together with the Trade Business Desks located strategically nationwide are always within your easy reach. IMPORTS Letter of Credit Our letters of credit offer you a secured means of paying your suppliers by ensuring the documents you stipulate are in order before we effect payment. With over 600 agent banks in more than 90 countries worldwide.

you will need to provide your acceptance or undertaking in order to take delivery of the shipping documents . We can also have your export letters of credit confirmed. a letter of credit provides you with the assurance of receiving payment against your shipping documents which comply strictly to the terms and conditions as stipulated in the letter of credit. we will also inform you immediately. you may take delivery of the shipping documents. This will remove any concerns you have with letters of credits received from countries or banks you are not comfortable with as our confirmation will remove the sovereign and bank risks. . We shall keep track of your export collection until the proceeds are received by us whereby we will credit your account promptly.Collections We will inform you immediately upon receipt of the shipping documents received from your supplier. Upon your payment. Financing We provide various financing options for your local purchases and imports at favourable rates. If credit terms has been arranged with your supplier. you will present your shipping documents to us for the collection of proceeds. Collections As the exporter. You will maintain control over the goods until they are paid for or until the buyer has given their undertaking or acceptance to pay at a future date. In the event of non-payment. Our trade advisors will be able to help you in this aspect. We will send your shipping documents to the buyer's banker with specific instructions as to the release of the shipping documents. You must be able to comply with the terms and conditions and in particular avoid any discrepancies in your documentation. Each of our financing options is designed to cater for specific needs and these include:     Bankers Acceptances Onshore Foreign Currency Loans Trust Receipt Invoice Financing EXPORTS Letter of Credit As an exporter.

We can also provide guarantees such as Performance Bonds.Financing We provide various financing options for your local sales and exports both pre and postshipment at favourable rates. Jabatan Imigresen and Kastam. Transferable LCs If you are a trading company. . Each of our financing options is designed to cater for specific needs and these include:        Bankers Acceptances Export Credit Refinancing .Pre-shipment and Post-shipment Advance Against Trade . we can assist you to transfer the LCs received in your favour to your suppliers either in full or in part. Export Credit Insurance Export Credit Insurance assists you to extend credit terms to qualified international or domestic buyers and reduce the risk of non-payment. you can now venture into markets you would not have considered previously. For your international trade. Tender Bonds. With the Export Credit Insurance in place. You can also have the access to increased working capital with our specially structured financing product against payment of an arrangement fee. We can arrange for the evaluation of your buyers as well as arranging to insure them against non-payment risk. political or economic deterioration may also result in non-payment. This will ensure that payment risks between all parties are eliminated when complying documents are presented. Telekom Malaysia. Supplier Credit Guarantees and Financial Guarantees. This risk is similarly covered under the Export Credit Insurance.Pre-shipment and Post-shipment Invoice Financing Onshore Foreign Currency Loan Foreign Bills of Exchange Purchased/Foreign Bills of Exchange Purchased (Approval to Purchase) Domestic Bills of Exchange Purchased/Domestic Bills of Exchange Purchased (Approval to Purchase) SERVICES Bank Guarantees We can issue Bank Guarantees in standard formats favouring beneficiaries such as Tenaga Nasional.

Guarantees include bid. Bank guarantees in nature are separate transactions from the contracts they relate to. RHB Bank will assist in issuing guarantees on your behalf to support your business activities. customs. The scheme allows the financing of exports at competitive rates. Post-shipment ECR is advanced to exporters to finance the export of eligible goods after shipment. Financing is categorized under pre-shipment ECR and post-shipment ECR.RHB Bank Bank Guarantee For the Importer Bank Guarantee is a financial instrument where the bank guarantees a stated sum of money to the beneficiary upon non-performance of the applicant's obligation and performance. advance payment. Pre-shipment ECR is advanced to facilitate the production of eligible goods prior to shipment and encourage backward linkages between the exporters and local suppliers. Benefits    RHB Bank provides an undertaking on your behalf. performance. and provides comfort and assurance to your business counterpart RHB Bank assists in reviewing the content of your guarantee before issuance. Benefits     Competitive financing rates offered Pre-shipment financing provides working capital upon receipt of export orders Allows the exporter to pay their suppliers early and secure better pricing Allows the exporter to expand their business with the added funds . utilities and security deposit guarantees. tender. thereby protecting your interest Facilitates transactions between contracting parties to extend your reach beyond local boundaries Export Credit Refinancing For the Exporter RHB Bank participates in the Export Credit Refinancing (ECR) Scheme initiated by Bank Negara Malaysia. The scheme is currently managed by Export-Import Bank of Malaysia Bhd to promote Malaysia's exports and international trade.

Benefits      Reduces the risk of non-payment by the buyer as payment is guaranteed by a bank Reduces the risk of non-payment by the buyer's bank when your documents are checked by a bank Governed by International Chamber of Commerce rules Allows access to financing options through our comprehensive range of export financing products Can be received from buyers worldwide in major currencies in the form of SWIFT.Letter Of Credit For the Importer RHB Bank's Letter of Credit allows you to make payment only upon presentation of compliant documents by your supplier. Upon receipt of the Letter of Credit. The Letter of Credit also allows you to take control of your payment terms and establish your credit worthiness as a buyer. documents you have agreed with your supplier at the beginning. Thus. courier and registered mail. you are assured that your interests are taken care of in the process of purchasing goods. Benefits       Minimizes the risks of non-delivery or late shipment as the Letter of Credit assures your supplier of payment Ensures your goods are delivered within the agreed terms and conditions Improves your credibility as a purchaser Allows access to financing options through our comprehensive range of import financing products Governed by International Chamber of Commerce rules Can be issued to suppliers worldwide in major currencies in the form of SWIFT. telex. The same documents spell out the terms and conditions you have agreed with your supplier. telex. the exporter will ship the goods in accordance with the terms and conditions of the Letter of Credit and present documents to reflect compliance. For the Exporter Letter of Credit provides the exporter with assurance that payment will be received if the terms and conditions of the Letter of Credit are met. Thus the exporter can prepare for shipment or even source materials required to manufacture the goods for shipment upon receipt of the Letter of Credit. courier and registered mail . Documents presented will then be checked for compliance and payment is guaranteed by the buyer's bank.

Benefits    Allows you to take possession of the goods without having to use your own funds immediately Improves cash flow by having additional time to convert your goods into cash Flexibility in payment as partial repayment and early repayment is allowed without penalty .Trust Receipt For the Importer RHB Bank allows you to finance imports on Letter of Credit. Trust Receipt is an agreement signed by the buyer and the bank. Documentary Collection and Open Account through Trust Receipt. Trust Receipt allows you to take possession of the goods and convert the goods into cash prior to maturity of the Trust Receipt. which states that the buyer will hold the goods in trust as the agent of the bank. The buyer will sell the goods and use the proceeds of sale to settle the advance made to the buyer.

The customer also undertakes to purchase the said goods from the Bank upon negotiation or acceptance of the said credit under the principles of Al-Murabahah or lump-sum deferred payment sale. and subsequently releases the documents to the customers. The customer informs the Bank of his Letter of Credit-i requirements and requests the Bank to provide the facility. The Bank’s selling price comprises its cost and a profit margin that will mature on a specified future date.Eon Bank The Essential Trade Financing Facilities The facility is an Interest Free Trade Finance Facility designed to suit your business needs. the Bank pays the proceed to the negotiating/accepting Bank and subsequently then sells the goods to the customer. Trust Receipt-i Trust Receipt-i is a trade finance facility offered by the Bank to facilitate customers’ importation/purchase of goods which are relevant to their business. The Bank may require the customer to place a deposit to the full amount of the price of the goods to be purchased/imported which the Bank accepts under the principles of Al-Wadiah Yad Dhamanah. . The Bank charges the fees and commission for its services under the principles of Al-Ujrah. The Bank establishs the Letter of Credit-i and pays the proceeds to the negotiating bank utilising the customer’s deposit. the customers have to establish a letter of credit for settlement of the related transaction with the seller/exporter. Under this arrangement. the Bank acts as an Agent of the customer. Prior to the financing. Upon negotiation of a sight Letter of Credit-i or maturity of a usance Letter of Credit-i. the customer informs the Bank of his requirement and requests that the Bank purchases/imports the intended goods by establishing Letter of Credit-i with the Bank. Facilities Letter of Credit-i Under this concept.

being an importer may match your differed payment to us according to your ageing of credit terms. the customer pays the bank the agreed sale price in full. The Bank’s profit margin will be benchmarked to the prevailing funding cost plus the approved margin. payment to supplier can be made immediately and you. inventories. IAB will facilitate sourcing of immediate funds for working capital for manufacturers who want to increase sales by offering competitive credit terms to their customers.Accepted Bills-i Accepted Bills-i. Through our international network. However. whether as an importer. we ensure your import and export settlements can be carried out efficiently at minimum charges. an exporter. Hence. On due date. Documentary Collection (Import/Export)-i Documentary collections for import and export are operated under the principles of Al-Wakalah (Agency). once the Sales Price is contracted. It is a relatively cheaper form of short term financing for both external and domestic trade as the profit margin is benchmarked to the Islamic InterBank Money Market rates (Profit is calculated at fixed rate for the period of financing). . In financing of usance sales of residents/non-residents. it will be fixed until its maturity. IAB will help a trader to obtain a discount from the supplier as payments by the Bank is on cash term. The Bank subsequently sells the goods to the customer at an agreed price comprising the purchase price and the profit margin and allows the customer to settle the price on a differed term. parts or semi-finished goods and raw materials. Under Murabahah arrangement. IAB is an alternative to the conventional Bankers Acceptance (BA). It can be extended to facilitate in purchasing stocks. Murabahah Working Capital Financing (MWCF)-i MWCF-i is the financing of trade by way of lump sum deferred payment cost plus profit sale. Under MWCF-i the Bank appoints the customer as its agent to purchase the required goods on its behalf and settles the purchase price (at sight or upon maturity for usance bill) to the supplier. a manufacturer or a trader. commonly known as IAB is a very useful facility to boost your liquidity requirement. Under this facility the Bank acts as a collecting or paying agent to you.

forwards to the Bank the debt documents in relation to his contract. This will facilitate the customer’s cashflow for generating further business contracts. When the Bank is satisfied that all the terms and conditions of the facility have been complied with. This facility is an alternative to conventional discountings. In addition the customer is also required to submit the Assignment of Payment from their Awarding Party. the customer who wishes to avail himself to this facility. . The Bank Guarantee-i may be issued to cover the following needs:  Tender Guarantee  Performance Guarantee  Guarantee for Advance Payment  Guarantee in Lieu of Security Deposit/Supply Guarantee  Guarantee for Sub-Contract  Guarantee for Exemption of Custom Duties  Custom Bond  Guarantee for maintaining Ledger Account  Guarantee for Honouring of Cheques Shipping Guarantee-i Shipping Guarantee-i helps the importer to clear the purchase goods under Letter of Credit-i while awaiting presentation of the shipping documents. Bank Guarantee-i The Bank Guarantee-i constitutes an undertaking to guarantee the performance in your business obligation to a third party in case of any default. Under this agreement. the creditor may sell the debt to Bank at an agreed price and undertakes to recover the amount from the debtor upon its maturity.Bai-Al-Dayn-i A deferred payment contract or sales give rise to a debt. we will purchase the debt and proceeds will be credited into customer’s account. It saves you from incurring additional charges for storage and clearance of goods by the Port Authority while awaiting the arrival of the shipping documents. While waiting for the payment.

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