Trade Finance Checklist: What Lenders Want to See

Trade Finance Checklist What Lenders Want to See

Trade Finance Checklist What Lenders Want to See

You want a fast yes. Lenders want control, clean paper, and a repayment path that does not depend on luck. Use this checklist to package a bank-ready file for inventory, pre export, import, or LC backed deals.

Outcome: a tight file that clears underwriting, protects collateral, and pays down on time.

Signals That Get You Approved

Contract and counterparty
Signed SPA or PO, named buyers, issuer acceptability for any LC, KYC cleared, sanctions clean.
Collateral control
Title documents in control, recognized warehouse or terminal, named collateral manager, audit rights, loss payee clauses.
Cash cycle and hedge
Cash waterfall to a controlled account, matched hedges for price and FX, clear exit or takeout.
Dates that work
Shipment window, inspection slots, and bank SLAs aligned, not theoretical.

Bank-Ready Master Checklist

Category What Lenders Want to See
KYC and legal UBO chart, IDs, corporate docs, good standing, sanctions screen, licenses where required.
Contracts Executed SPA or PO with Incoterms, specs, quality, volumes, price formula, delivery window, fee split for banking charges.
Payment route LC draft under UCP 600 or standby under ISP98, collections D/P or D/A terms, or insured open account with policy draft and assignment rights.
Collateral and title B/L originals or warehouse receipts held in control, terminal agreements, CMA, release conditions, daily stock reports template.
Insurance Cargo and storage policies, lender as loss payee, endorsements, political risk if relevant, deductible levels disclosed.
Inspection and quality Named inspector, sampling plan, COQ templates, pre shipment and outturn certificates timing.
Cash flow model Shipment by shipment cash plan, advance rate, fees, interest, hedge costs, DSRA or margin requirements if any.
Hedging Price and FX hedge policy, counterparties, limits, and proof of live cover matched to tenor.
Collections and waterfall Controlled account, sweep logic, priority of payments to lender, costs, and profit release rules.
Covenants and reporting Stock turn targets, eligibility criteria, limits per buyer, weekly MI pack outline, inspection and variance reporting cadence.
Legal pack Facility draft, pledges, account control, CMA, assignment of receivables or LC, intercreditor if any, sanction wording, EHS if required.

Advance Rate Expectations by Collateral

Collateral Type What Improves Advance Common Haircuts
In-warehouse inventory Top tier warehouse, CMA, insurance, daily reports Quality and price volatility, country risk, shrinkage
In-transit cargo Original B/L control, named carrier, all risk cargo cover Route risk, port congestion, documentation errors
Receivables Approved buyers, credit insurance, short tenor Dilution, disputes, concentration caps
LC proceeds Confirmed LC, clean document list, nominated bank pay Discrepancies, issuer risk without confirmation

Logistics and Control Checklist

Title and storage
Original B/L routing, warehouse receipts wording, release conditions, lien clear letters, signed terminal agreements.
Operational control
Collateral manager name, daily stock and movement reports, surprise audit rights, stop release logic on covenant breach.
Insurance and claims
Policy numbers, endorsements, claim notice process, valuation basis, deductible, and co insurance terms.
Compliance
Sanctions checks, HS codes, certificates, ESG where required, and corridor specific permits.

Document Pack to Send on Day One

Document Why it matters Owner
SPA or PO and addenda Defines exposure and milestones lenders will fund against Commercial
LC or standby draft, or insurance policy draft Confirms payment route and bank roles Trade finance
Warehouse or terminal agreement, CMA draft Gives lenders control over physical stock Operations
Insurance binder and endorsements Protects value from loss while financed Insurance
Cash flow model and hedge plan Proves ability to repay and manage volatility Finance
KYC pack and sanctions screen Clears onboarding and compliance review Legal

Covenant Ideas That Keep Lines Open

Operational
Max stock days, minimum turn, eligibility criteria, limits per buyer and per port, no off system storage.
Financial
Minimum liquidity, DSCR on cash cycle, hedging limits, material adverse change notifications.
Reporting
Weekly MI with stock, movements, sales, AR aging, hedge positions, exceptions and cures.
Release mechanics
Automatic reductions on delivery or LC payout, stop release on breach, dated clean down if needed.

Red Flags That Slow or Kill Approval

  • Soft clauses in LCs, vague inspection wording, or issuer the counterparty will not accept
  • Unknown warehouse or collateral manager, no audit rights, weak release terms
  • Unhedged price or FX exposure during the facility tenor
  • Buyer names with no credit comfort, long tenors without mitigation
  • Missing endorsements on insurance or loss payee not in place
  • Presentation timelines that clash with vessel or port realities
Attention. Slow files get bumped behind cleaner deals.
Desire. Present a tight pack that answers credit questions before they are asked.
Action. Send your contract, corridor, storage plan, and payment route. We return a lender shortlist, advance rate, and a closing checklist matched to your dates.

How We Package a Yes

Lender route
Trade banks, private credit, and repo desks that fund your goods and corridor.
Control stack
CMA, storage, insurance, assignment wording, and account control ready to sign.
Underwriting file
Risk memo, model, hedge map, and reporting pack that credit teams use to approve.
Execution control
We track dates, drafts, and conditions precedent until funds land.

Deliverables

  • Bank ready document pack and checklists
  • Named lender shortlist with appetite notes and timing
  • Collateral and covenant term sheet with reporting templates
  • Draft wording for LC, standby, CMA, and assignments
  • Closing checklist mapped to shipment and clearance dates

Want a Fast Yes From Lenders

Share your contract, corridor, storage location, and payment route. We will come back with a route to lenders, control terms, fees, and a funding timeline that matches your trade.

Start the Process

This checklist is informational. Any facility is subject to lender due diligence, independent credit approval, KYC and AML checks, sanctions review, and executed documentation. Terms vary by goods, corridor, counterparties, and market conditions.

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