Business Banking Accounts Payments through Electronic Banking Trade & Factoring Services Loans & Credit Facilities We will enable you to trade with confidence Import Services Our experienced trade team ensures that all the necessary safeguards have been put in place for a smooth import transaction. We take care of Documentary Credits and Collections, so you don't need to worry. Export Services HSBC can provide you with advice on any aspect of your export document preparation. We can also provide working capital finance to help you source your raw materials. Factoring Services Our Factoring team has the experience, resources and technical capabilities to support the needs of your business from local to global. Import Services Benefit from Documentary Credits and Collections by our experienced trade team. DOCUMENTARY CREDITS (DC) DCs, more commonly known as letters of credit (LC) are a widely used method to effect payments in domestic and international trade. A written undertaking is issued by a bank (usually referred to as the issuing bank) on the instructions of the buyer of goods to the seller. The payment is made under conditions stated in the undertaking. Payments are always up to a stated limit and against stipulated documents. The use of a DC provides enough safeguards for the parties involved. The seller is ensured payment, provided that he complies with terms that he/she has agreed to while the buyer can include all terms and conditions within the DC that satisfy him on the quality and quantity of the goods without having to sight / inspect the goods themselves Since banks act as trustworthy third parties/ intermediaries, the issues relating to trust between the buyer and the seller is taken care of: DCs can be either sight or usance depending on whether credit period is extended to the buyer by the seller. Important aspects to check for when you receive a DC are: Payment terms Availability of the DC Acceptability of issuing bank Terms of shipment Feasibility of complying with terms of the DC Workability of the DC Confirmation to a DC enhances security under the DC and mitigates any existing issuing bank and/ or country risk since the same are taken over by the confirming bank. COLLECTIONS Trade between counter parties on collection basis is carried out where there is an inherent comfort level between the buyer and the seller but each party desires to safeguard itself to some extent. However, the buyer is at relatively lower risk than the seller. He can inspect the documents before paying for them. The collection cycle starts when the seller, having shipped the goods and obtained the necessary documents, presents the documents together with his instructions to his bank (remitting bank). The Bank will send these to its branch/ correspondent bank (collecting bank) in the buyer's country for payment. Collection can be on D/P (Documents against Payment) or D/A (Documents against Acceptance) basis. Under D/P, the buyer gets the title to the goods only after he pays for them. In a D/A scenario, the buyer gets title to the goods against accepting to pay on a future date (i.e. due date) by accepting a Bill of Exchange drawn by the seller on the buyer; hence a credit period is extended by the seller to the buyer. The risk to the exporter is much greater because he does not have a bank's undertaking as in the case of a documentary credit. This system is usually used when dealing with parties that have an established track record or where the exporter is sure that the importer will not refuse the goods. Export Service SERVICES OFFERED: Export DC Advising - Prompt advising of the DCs received from wide range of issuing banks worldwide. Export DC Transfer - Transfer of DCs established in your favour to manufacturers where you are acting as the intermediary. Export DC Confirmation - Confirmation of export DCs from wide range of acceptable issuing banks thereby obviating issuing bank risk and enhancing the security of your export receivables. Export Collections - Facilitating your export transactions on non-DC basis. HSBC Group's wide network ensures that you receive your payments quicker. *Export Financing - Pre-Shipment Finance: Financing your pre-shipment requirements enabling you successfully and satisfactorily accomplish your pre-shipment activities. *Negotiation under Export DCs - Negotiation of your export / inland trade documents under DCs from wide range of issuing banks ensuring prompt realization of your sale proceeds. *Conditions apply Factoring HSBC offers Factoring Services in Pakistan. Our Factoring team has the experience, resources and technical capabilities to support the needs of your business from local to the global level. What is Factoring Factoring combines sales-lined finance, bad debt protection, payment collection and transmission services that helps businesses to compete with local suppliers on equal trading terms. Quite simply, if a business is trading with another business on open account credit terms, HSBC Factoring Services has the potential to help grow business sales, speed up cash flow, collect payment on invoices and, in selected cases, even protect business from the risk of bad debt. BENEFITS OF FACTORING TO YOUR BUSINESS IN PAKISTAN: Flexible finance enables you to accept new orders with confidence Available funds can help to give you greater buying power with your suppliers It helps you avoid the dangers of over-trading Your funding keeps pace with your sales setting up new limits and reviewing those in place is now quicker and easier Based on sales invoices, additional fixed asset security is not normally required Protects your profits and cash flow against the ever-present trade credit dangers of bad debt (with pre-approved individual debtor limits) It helps to release additional time and resources (from chasing and processing payments) enabling you to concentrate on your core business activities Our international factoring correspondents across the globe have country specific knowledge and can correspond with your buyers in their own language Range of Factoring Services Finance against invoices benefit from the HSBC pay for funds in use service Sales ledger administration related to account receivables Collection of receivables we take great care to support your hard won customer relationships - collecting tactfully, efficiently and effectively Credit vetting of buyers Download Referral Form Download Business Banking Contact Form Contact us Business Telephone Banking Centre: 92 21 0800 85201 Monday to Saturday (9:00am - 6:00pm) Visit our nearest branch