International Business Services: Exporting

Huntington provides a full range of Export Financing options to help you with your export sales.

Do you receive checks drawn on foreign banks or denominated in a foreign currency? Huntington will clear the checks and deposit the money into your account.

Check Collections are useful for one or two items at a time. Companies receiving larger volumes of checks will want to use our Direct Foreign Cash Letter forms to speed processing and reduce costs.

With the approval of your Huntington Banker, we can arrange to deposit funds into your account even before we receive reimbursement from the foreign bank. Of course, the deposit is subject to reversal if the foreign item is eventually returned unpaid.

A risk mitigation tool, Trade Credit Insurance, protects suppliers against the risk of non-payment of goods or services by their customers. Coverage can be provided for domestic risk (buyers in the same country) or export risk (buyers located in another country).

The insurance typically covers non-payment due to insolvency of the buyer or non-payment after an agreed number of months after payment was due (often referred to as protracted default). The coverage may also insure against the risk of non-payment following an event outside the control of the buyer or the seller such as political risk, where money cannot be transferred from one country to another.

Reduce the risk of your overseas buyer’s non-payment or slow payment with a Letter of Credit (LC) from your buyer’s bank.The LC is the bank’s promise to pay you upon your submission of certain documents showing that you have shipped the goods. As an Advising and Negotiating bank, Huntington acts as your conduit to the foreign bank and follows up to ensure you get paid quickly.

You may want to pass the risk to Huntington in the form of an LC Confirmation. In this case, we promise to pay you upon our receipt of the required documents regardless of whether the buyer and the bank are still able to pay.

Would you increase sales if you offered the buyer up to 180 days to pay? We can easily structure the LC so that the buyer receives payment terms, but you get a Bankers Acceptance: the bank’s unconditional obligation to pay you.

If you prefer, we will pay you now (less discount interest), then wait for the foreign bank to reimburse us. The discount rate may be less expensive than most other types of loans available, and it doesn’t affect your credit line, since we view it as a loan to the foreign bank.

Are your overseas buyers slow in paying? Do they want extended terms? Could you increase sales if you could better manage the risk?

One way to reduce your risk is to maintain control over the documents your buyer needs to take possession and legal title of the goods and to clear customs. By holding the Bill of Lading, Commercial Invoice and other documents until the buyer pays, you’re much more likely to receive prompt payment of the full amount.

Acting as your agent, Huntington does the work for you. We’ll send your documents and instructions to our correspondent bank closest to your buyer. They’ll contact the buyer, and exchange the documents for payment. If you have allowed for it, we will exchange the documents for the buyer’s acceptance of the draft, creating an unconditional payment instrument due on the date you have specified.

Huntington will maintain electronic communications with the foreign bank, following up to ensure receipt and to track the progress. If you use collections frequently, we will send you monthly reports itemizing activity and listing outstanding items.