Page 269 - International Marketing

NPP

BRILLIANT'S Export Management 271

5. To procure goods from domestic market in case of merchant
exporters.
6. To store the goods in warehouse before shipment.
7. To pay for internal transportation and marine freight.
8. To fulfill customs formalities, excise clearance and pre-shipment
inspection.
9. To open and maintain foreign offices for export promotion abroad.
10. To pay for export documentation expenses.
Methods or Types of Pre-shipment Finance
1. Extended Packing Credit Loan: It is extended to those export-
ers who are rated as first class exporters by the commercial banks on the
basis of their creditworthiness. It is granted for making advance payment
to the suppliers for acquiring goods to be exported . Such advance is
generally clean, i.e. granted without any documentary evidences for a
very short period of time.
2. Packing Credit Loan(Hypothecation): It is extended for the
acquisition of raw-materials, work-in-process or finished goods meant for
exports. The goods so acquired are treated as security for sanctioning of
loan . Under this facility, the exporter is required to execute a hypotheca-
tion deed in favour of the bank, while the
possession of goods remains with the ex- Methods or Types of
porter. Pre-shipment Finance
3. Packing Credit Loan (Pledge): It 1. Extended Packing
is extended for the acquisition of seasonal Credit Loan
raw-materials or raw-material in odd or
bunched lots. The export takes place in due 2. Packing Credit
Loan(Hypothecation)
course after processing as per the shipping
and delivery schedule agreed upon by the 3. Packing Credit Loan
overseas buyer. The documents relating to (Pledge)
raw-materials are pledged with the bank while 4. Secured Shipping Loan
the possession remains with the exporter. 5. Advance against Red
4. Secured Shipping Loan: Secured Clauses Letter of Credit
shipping loan can be obtained once the goods 6. Pre-Shipment Credit in
are handed over to the transport operator or Foreign Currency
clearing and forwarding agent for the ship- (PCFC)
ment. It is released against lorry receipt or 7. Advances against Back
railway receipt. It is extended for a very short to Back Letter of credit
duration considering the time taken for dis-
patch of goods to the port and completion of 8. Advances against
shipping and customs formalities. Export Incentives