Trade Finance over the years

Trade finance has been in existence since time immemorial. If you were to search for word trade finance on internet,it is interesting to note that there is a reference of Trade finance found in ancient texts of Mesopotamia and is also mentioned in the Silk route-China.

Over the years trade finance has evolved much more than just buying and selling of goods , in to a globally viable business model, where the banks and financial institution offer trade finance models tailored according to the business requirement of importer/exporter. Today we have Post/pre Shipment finance, Forfaiting, Structured Trade Finance, Commodities trade finance and Islamic Trade Finance and to mitigate risk there is Export Credit Insurance, Export Credit Guarantee.It is under the process of constant evolution. With the advent of technology, there is a need to eliminate the structural and physical barriers between Banks and customers and move towards an integrated and faster system whereby all the parties involved are linked electronically, eliminating paper and bringing in electronic documents.