Financing Against Trust Receipt

A trust receipt is a written legal document between a bank and its customer, stating that the bank will give goods to the Customer but the bank will still retain the title to the goods and can repossess it if the buyer does not uphold the terms decided upon in the trust receipt. The Customer must keep the goods and any profits made from that goods separate from normal business expenses and if the bank repossesses the items, the Customer will return the items or the money made from selling the goods. So Trust Receipt is a deferred payment facility from the Bank under the LC obligation that enables the customer to defer the payment to the Supplier without reducing his credibility. With this facility, the customer can defer his payment obligation to the Bank, but can still be able to get the goods that has already been ordered with the LC. The customer simply has to submit a TR Letter which basically contains a statement of receiving the goods on Bank’s behalf and promising to pay the Bank. Please do give me a call for better understanding of the email.