Trade with Confidence in Emerging Markets

Businesses are increasingly keen to tap into the wealth of opportunities emerging markets present. 

Securing payments in emerging markets, however, may pose as a difficulty and may lead to trade transactions falling through. Find out how you can safeguard your transactions and trade with confidence in these less familiar markets.

receiving payments

Receiving payments

Your company may choose from the following modes of payment for the goods that you export:

1

Cash

Cash

How Secure: 3 Stars

How it Works: Buyers will pay cash – in part or in full – to you (the exporter) before or upon delivery of the goods.

Benefits to Exporters: Most secured form of payment as you will get paid upon goods delivered or services rendered.

Challenges: Your competitors may gain a competitive edge over you if they are able to offer more competitive credit terms to your buyers.



2

Letter of Credit

Letter of Credit

How secure: 2 Star Rating

How it works: You may choose to extend credit terms to your buyers according to your level of trust with each individual buyer. Buyers are given a mutually agreed time period to make full payment for the goods they have received.

Benefits to Exporters: Your bank assumes the payment risk of your seller's bank and assures that you get your payment for your trade transactions.

Challenges: Singapore-based banks may have limited risk appetite to accept letters of credit from foreign banks in emerging markets due to the higher perceived risks.

3

Open Account

Open Account

How secure: 1 Star

How it works: You may choose to extend credit terms to your buyers according to your level of trust with each individual buyer. Buyers are given a mutually agreed time period to make full payment for the goods they have received.

Benefits to Exporters: Can enhance your competitiveness vis-à-vis other exporters by extending credit terms to your buyers.

Challenges to Exporters: You may not be able to collect your payments if your buyers default on the payments and/or become insolvent.

Schemes that help safeguard your payments

Trade Facilitation Scheme

Trade Facilitation Scheme

Through Trade Facilitation Scheme (TFS), IE Singapore enhances the capacity for the issuance of credit guarantees under ADB’s Trade Finance Programme to Singapore-based banks.

With the credit guarantee covering up to 100% of the non-payment risk from the foreign bank in emerging market, Singapore-based banks will be more forthcoming in accepting the Letter of Credit. This in turn facilitates Singapore exporters’ receipt of payments for transactions with buyers from emerging markets.


Trade Credit Insurance Schemes

Trade Credit Insurance Scheme

Trade Credit Insurance (TCI) can help protect against non-payment by your buyers when you extend credit terms to them.

IE Singapore can facilitate your access to TCI through the Trade Credit Insurance Scheme (TCIS).

To find out more

Learn about the Trade Facilitation Scheme (TFS) and the Trade Credit Insurance Scheme (TCIS).

To find out more

Call us at 1800-IESPORE (1800-437 7673) or +65 6337 6628, or
Email us here