Packageing, also known as trade packages, is a means of obtaining liquidity in trade finance, where exporters receive liquidity by selling their receivables abroad (medium and long term) at a discount and on “no recourse”. In principle, without recourse or not, the package takes care of and accepts the risk of non-payment. In this case, a packager is a specialized financial institution or banking department that carries out export financing transactions without resorting to the purchase of medium- and long-term debts from an exporter. In this case, a master risk-taking contract can be used to transfer a lender`s interest on a borrower`s receivables to a participant. In the package, a borrower`s receivables are usually guaranteed by the participant, the importer`s bank. As noted above, the original lender`s interest in the lender in the risk-participation agreements is sold directly to the participant. With respect to risk participation, the lender cedes an economic interest to a member`s loan contracts, which allows the lender to benefit from an economic benefit under the loan agreement between the lender and a borrower. Export credit insurance financing is an insurance credit facility issued by a lender to an exporter to protect the exporter from the risk of non-payment by a foreign importer. Export credit insurance can be short-term or long-term.
This financing facility can be transferred to a participant through a master participation contract. Risk-involved agreements are mainly used in international trade to facilitate financing arrangements between a lender and a borrower. With respect to risk participation, the lender cedes an economic interest to a member`s loan contracts, which allows the lender to benefit from an economic benefit under the loan agreement between the lender and a borrower. The member is entitled to certain benefits, such as the payment of the principal amount. B and interest and other borrowing costs on the loan granted by a loan by a lender. The member`s obligation to participate is to finance the loan on behalf of the original lender on the terms of the main venture agreement and in accordance with the loan agreement between the original lender and the borrower. Although the concepts of “participation” and “unionion” are often used in a synonymous manner, it should be noted that there are significant legal and structural differences between risk-taking and syndicated loans. The difference between risk participation and syndicated credit lies in the lending structures used in the two financing agreements. There are various possibilities for the use of master-participations, which are mainly in the area of trade finance. Some of these uses are explained below: These versions of the master equity contracts were developed in the form of sectoral documents used by banks to facilitate the purchase and sale of risks related to the exchange of countries and banks.
These agreements are intended to facilitate the exchange of documents between banks and to reduce legal costs by minimizing redundancies. Trade finance uses specific instruments that facilitate international trade.