Clean Import Loans

For businesses that import goods, it can be a very costly endeavor. Typically, there are two types of loans that can be used to assist businesses with the high cost of importing. One is called a loan against import, and the other is called a clean import loan. While both a very similar in nature, they also have some very distinct differences as well. Both loan against import and a clean import loan are what are called working capital types of financial transactions. Working capital is simply a business’ current assets (profits) minus their current liabilities (expenses). For both types of loans, the business gets the tangible goods delivered so that they can begin selling their products and make a profit. With a loan against import, the bank technically owns the items until the business can repay the loan. With a clean import loan, the business owns 100% of the goods.

For loan against import, trust receipts are granted to the borrower so they can use their goods, but have proof that those goods still really belong to the bank. With a clean import loan, all that is needed is proof of supplier invoices and proof of shipment. The supplier invoices shows the bank that your business has been issued a bill for the goods received. This exhibits that your business is in good standing with the supplier, and that you are in fact planning to pay for your delivery. Proof of shipment is needed to show that you have actually received the goods and can begin selling them. Upon showing the bank this information, your business will receive a loan so you can cover the import bills and costs. Both a loan against import and a clean import loan are helpful ways to support operating costs and manage overhead while you wait to turn a profit.