Bill Discounting
Bill discounting financing helps companies improve working capital and liquidity by enabling the purchase of goods and commodities at a discounted price and their delivery to companies to sell to buyers.
Application Process
What’s the process?
Client (seller) acquires a quotation with deferred payment
Submits quotation for financing
Availability of goods is verified
goods bought from client at a discounted price
QDB appoints client as agent through a separate agency contract
QDB pays cash to client based on the commercial invoice
Key features
What are the key financing terms?
- QDB buys the goods or commodities from the client at a discounted price after verifying that the goods or commodities have been produced and exist based on a site visit by a QDB representative or a good certification document produced by the client and approved by QDB’s Credit and Risk Management Department
- Maximum Financing Allowed: Up to 90% of value of the purchase order/proforma invoice depending on the rating of the client and features of the transaction
- 3% - 5% profit rate depending upon the internal risk rating and the contribution of the sector to Qatari economy
Frequently asked questions
FAQs
What is Bill Discounting?
Bill discounting is a financing solution offered by QDB to help companies improve working capital and liquidity by enabling the purchase of goods and commodities at a discounted price to be sold to buyers.
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What are the financing key features?
QDB buys the goods or commodities from the client at a discounted price after verifying that the goods or commodities have been produced and exist based on a site visit by a QDB representative or a good certification document produced by the client and approved by QDB’s Credit and Risk Management Department
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What is the maximum financing and repayment period?
Financing covers up to 90 % of value of the purchase order/proforma invoice depending on the rating of the client and features of the transaction. The facility will be valid for one year with an option for renewal at the discretion of the bank.
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How is financing calculated?
The purchase order/proforma invoice/quotation is financed up to 90% of its total value and paid to the seller as agreed. A separate financing account is maintained in the name of the client.
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What are the required documents?
-100% personal guarantee coverage by one or more of the Qatari sponsors or bank guarantee from foreign sponsor if Qatari partner doesn’t provide for 100%
-100% corporate cheque coverage and post-dated Cheques as per project guidelines
- A foreign buyer’s guarantee signed by the clients
- Additional documents that may be required later.
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