Wells Fargo & Company has announced the launch of an online trade finance facility designed to cater for manufacturers and exporters who prefer open account to letter of credit (L/C) transactions.

Trade Finance Online (TFO) will allow companies to use the Internet to convert their foreign and domestic accounts receivable into cash, reduce foreign credit risks, track outstanding accounts receivables and available credit with online reports. The North America-focused financial group claims this will provide its customers with increased convenience, control, efficiency and security.

Invoice financing

Accessed via Wells Fargo's Commercial Electronic Office Solution, TFO allows users to upload and check invoices for qualification against credit insurance and financing limits and then submit them for financing or purchase by the bank, online. This service is designed to provide quick access to information for treasury, credit and collection departments.

Wells Fargo's senior vice president and export finance manager, Ken Petrilla says TFO will help companies free up working capital and provide them with immediate access to information designed to reduce risk. "Financing invoices was previously done manually, in a more difficult to manage, time-consuming fashion," he maintains.

Benefits

Designed for exporters with more than US$5 million in qualified export sales, TFO is essentially a mechanism for converting foreign receivables into cash. Wells Fargo says demand for the new facility is attributable to a number of factors including the preference of some manufacturers and exporters for open account rather than L/C payment terms as well as their needs for greater management control over credit exposure to domestic and foreign buyers, accelerated collections and cash flow, and improved balance sheet efficiency.

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