Banking · International Trade Finance
In international trade finance, forfaiting is a high-value, non-recourse discounting mechanism. Consider the following statements regarding a forfaiting transaction under URF 800 rules: Statement 1: The exporter is protected from Transfer Risk because the forfaiter purchases the debt without recourse. Statement 4: Forfaiting clears the exporter's balance sheet of long-term receivables and improves the debt-to-equity ratio. Statement 5: The 'Aval' provided by the importer's bank is an irrevocable and unconditional guarantee of payment at maturity. Statement 6: Under URF 800, a forfaiter is allowed to sell the purchased promissory notes to other investors in the secondary market. Which combination of statements is correct?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1All statements are correct
- 22, 4, 6, and 7 only
- 31, 2, 3, and 5 only
- 41, 4, 5, and 6 only✓
Correct answer
1, 4, 5, and 6 only
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