FAQ's

If I use your program, will my customers think that my financial position is unsatisfactory?

No. You should never need to be concerned about that issue. This type of financial transaction has become so well established that almost certainly your foreign customers will have already done similar transactions through other suppliers that they have. During 1999 the total volume of business handled by a third party around the world was over $500 Billion USD. This type of financial arrangement is rapidly becoming the modern business tool for growing companies. Additionally, your customer is very happy that you have been able to provide them with amounts and terms that they could not have received elsewhere—and without using their own credit sources with a much higher cost.

If the foreign buyer doesn’t pay you, do I have to pay you?

No. Our trade credit finance programs are without recourse to you. Both the credit risk and the political risk of not getting paid is entirely that of EnviroTech Financial. However, your standard warranties and representations do apply. You may, however, wish to participate in additional profits by deferring a portion of your profit.

If the customer repays you as agreed, will you increase their credit line with you?

Yes. For the most part, anytime a foreign customer repays us within the terms agreed upon, we will increase their credit line to a larger amount. We want the customer to order as much as possible from you. We can help you get larger and more frequent orders simply by providing them the credit necessary to do so. All party’s win—you get larger and more frequent orders, the foreign buyer gets all the credit they need or ask for, and we get customers with larger outstanding balances.

Are there countries that you will not finance foreign buyers in?

Yes. Certain countries do not qualify for financing. Some examples are Iraq, Iran, Libya, Nigeria and Cuba.

Do the costs vary for each foreign buyer?

Yes. The invoice we submit to the foreign customer will reflect the following items:

Size of transaction

Length of credit terms the foreign buyer is requesting

Credit and financial strength of the foreign buyer

Country in which they are located

Special accommodations they have requested

How quickly can you give me answers to my foreign customers request?

The time to clear the credit and give you a final answer on each transaction will vary depending upon the following:

The size of the transaction—the larger the credit request, the longer it normally takes to get all the information

Does a current foreign company credit bureau report exist or does a new one have to be
developed or updated

How fast the foreign buyer get a complete credit application to us

How fast the credit references give us a written rating on the applicant

Normally, this can take from 10 days to six weeks or longer. Usually the biggest delay is with the foreign buyer getting their credit (and when required, financial information) application and supporting information to us. The approval can move very fast after we can the information needed to process the application. As a general rule, the larger the credit the longer the processing time.

Will the terms granted be those that the foreign buyer requests?

In most cases, we will be able to grant the exact terms requested by the foreign buyer. Occasionally, we will need to modify the terms asked for or in some instances actually decline the credit request if there is not adequate credit or financial information or the credit bureau reports show the foreign buyer does not pay their creditor’s in a timely manner.

Is the financing more expensive than the foreign buyer can obtain in their own country?

No. Actually, in the vast majority of cases, we can save your foreign customer substantial amounts of money over what they would have to pay to get the same terms in their own country (if they could get those terms at all). Plus, the customer will not have to put up a letter of credit with you or pay you cash before you ship the item(s) to them.

What does it cost for the foreign buyer to get the financing requested?

The only cost required to prepare the request for final credit approval is an up-front credit application fee that can be paid by the foreign buyer or by your company. This amount is non-refundable even if the credit request is declined. All other costs including shipping, finance charges (if terms longer than 30 days are requested by the foreign buyer), insurance, our administrative fees, third party inspection fees, etc. can all be included in our invoice to your customer when the item(s) are ready to be shipped. The administrative underwriting fees we charge are very reasonable when you consider the cost of chasing payments in foreign countries, the cost of bad debt charge off’s when they occur, documentation and credit administration we incur when processing a transaction.

Do I have any obligation whatsoever?

Yes. You must comply with the terms of the purchase order in every respect that was negotiated between you and the foreign buyer. The goods must be exactly as specified, packaged according to the buyers directions, inspected by a third party if required, etc. You will be held liable for any item(s) not meeting the requirements of the purchase order or terms and specifications called for by the foreign buyer.

Do you cover the risk of foreign customer insolvency before the goods have been shipped?

No. We are unable to cover this business risk for you. The risk we assume takes effect from the day the goods are actually shipped—the point at which an invoice can be generated. Pre-shipment risk insurance coverage is available from some sources and we would be happy to provide you with that information. It is normally used by some businesses that have a long production time or where the products are highly specialized and would be difficult to resell to another customer if the original foreign buyer refused to allow the shipment, refused to accept the product here in America or went into insolvency prior to your completion of the order.