What is Refinance?

Banks involved in trade finance transactions under letters of credit can obtain liquidity for an agreed period to support their underlying business. Payment is effected by SMBC to beneficiaries on eligible transactions on an at sight basis, without recourse. The bank repays SMBC with interest at the end of the refinance period. This arrangement provides financing and a predictable repayment schedule to the bank, whilst enabling beneficiaries to enjoy immediate full value on their receivables.