D/A forfaiting is an international exporter–financing arrangement for documents against acceptance (D/A) arrangements. It allows the exporter to receive up–front payment for selling trade–related bills at a discount and can be used for short–term liquidity as a limited–recourse or non–recourse financing.
Benefits of D/A Forfaiting
Risk hedging
- Hedge the commercial and country risk of the importer
Improving balance sheets
- Eligible for off–Balance sheet treatment, subject to consultation with your professional accountant, tax and legal advisors
Legal assurance
- No steps for perfection against obligor and third parties will be required subject to the laws of importer’s country and of export contracts.
