What is crystallization of export bills? How does delinking of export bills work?

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crystalization of export billsWhat is crystallization of export bills?

  

In this article, let me explain about crystallization of export bills. What is crystallization or delinking of export bills, how does crystallization of export documents work, what would be the impact of crystallization of export bills to exporter?

 

What is crystallization of export bills by bank?

 

As you know, once after shipping of goods, most of the exporters discount or negotiate the export bills with bank by submitting necessary export documents like Bill of Lading / Airway Bill, Invoice, Packing list and other required export documents. Most of the government supports exporters by extending financial assistance by providing them loan against export documents with very low rate of interest. Bank is expected to receive amount of such exports from overseas buyer on due date agreed mutually between buyer and seller. However, if export bills are not realized even after 30 days of its maturity, bank withdraws the facility of low interest rate by delinking the bills by converting commercial rate of interest. This is called crystallization of export bills. Crystallization of bills is also called delinking of export bills.

 

In this article, I have explained about the crystallization of export bills, how does crystallization work in export business with bank and the impact of crystallization with Exporter.

 

Would you like to add more about crystallization of export bills? Share your experience in facing crystallization of export bill delinking.

 

The above information is a part of Export import business Course online


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Click here to go back to: Bank finance to exporters against Pre shipment and Post shipment.

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Comments


Afthab BM: i had to know about issuing HBL.Can any freight forwarder issue HBL? Or is there any kind of licenses to be obtained?Can we just go to a printing press and print blank HBL?

prashant C joshi: Thanks for the explanation. However my bank has blocked my epc limit to the tune of outstanding payment. Please let me know in crystallisation can the bank block the limit or they have to discount the bills at current interest rate..also is there any master circular by rbi on this..if yes please send me.

jma salman: sir we r doing agricuitural products is it possible to extend of crystallization bills which we export Europe our company hve 100% eou status card 15 years same bank party assuring to pay asking some more time we ready to give assurance amount with in tha limit but bank want to adjust immeditly by our further bills sir is it possible to extend of crystilize bills theyhve sufficient in collateral security also but our bank is ready to help but in wat way plz give some sollutions regarding this subject

nitin: what is interest rate for crystallisation bills.

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