Trade
The trade finance gap holding back African trade
Africa faces a trade finance gap of about US$100 billion a year, just as a continental market opens. Why funding linked to real sales matters for Botswana’s businesses.
October 20264 min read- Home
- What we do
- Product capital
Funding for stock and supply
Funding for the stock that moves through our trading and distribution units, and for the customers who buy from them.
Overview
Funding for stock and supply
Trading runs on timing. Stock has to be bought before it can be sold, and customers often need terms before they can pay. Product capital closes that gap.
We fund suppliers and inventory for units across the group and, where it makes sense, extend payment terms to the customers they serve, so that an order is never lost for want of working capital. Because the funding is tied to a sale, it is repaid by the sale.
What it covers
In practice
- Supplier and inventory funding for group units
- Payment terms that keep customer orders moving
- Repaid from the sale it funds
- Pricing informed by the group’s own sales history
How it works
Four steps from request to repayment
Start with demand
A confirmed order, or a repeat pattern of sales we can see in the group’s own records.
Test the sale
We check the customer, the stock and the margin before any money moves.
Fund against the order
Funding is released against the order, with terms matched to the sales cycle.
Repay and reuse
The sale repays the funding and the same capital goes to work on the next order.
What we look for
What makes a strong case
- Real customer demand, ideally confirmed orders
- Products the group already sells and understands
- Margins that comfortably cover the cost of capital
- Short cycles that repay themselves
- Customers we can assess through existing relationships
- Clean invoicing and records
In context
Why it matters now
Africa faces a trade finance gap of about US$100 billion a year, and only 18% of African banks’ trade finance portfolios support trade between African countries.
Talk to us about product capital
Tell us what you sell, to whom, and what you need.