Export Factoring For Textile Industries
The Indian Textile and Apparels Export market has grown leaps and bounds over the last few years, with the country achieving the highest export value in FY22 at US$44.4 billion. Making the growth in the industry 26% YoY from FY21 and 41% from FY20. Read more
India is the 6th largest exporter in the world for Textiles and Apparels with 4% share of all global exports. The industry is one of the fastest growing sectors in India. With year-on-year growth exceeding most other export industries. Furthermore, the Government of India aims to boost the industry to a US$100 billion market with measures like capacity building, technology upgradation and boosting employment generation.
In lieu of these upcoming changes, exporters in the Textiles and Apparels sector will be given the opportunity to grow their businesses exponentially. However, this can be a challenge without the necessary liquidity in working capital. Export Factoring can be the financing option that can provide Textile and Apparels Exporters the extra edge they need to capitalise on these changes in the industry.
What is Export Factoring
Export Factoring is a global trade financing option where an institutional or independent financier buys s an exporter’s receivables invoice against goods provided to international buyers. This type of financing enables the exporter to get immediate liquidity to explore new growth opportunities.
It is best suited for:
- Exporters who are already established in the market
- Exporters who want to provide more flexible open account terms to their buyers to nurture better trade relations.
- Exporters looking to decrease the risk of buyer non-payment
- Exporters want liquid working capital for rapid growth periods.
How Export Factoring Can Help Textiles and Apparels Exporters
There are many long-term and short-term benefits of Export Factoring as an trade export finance for Automotive Trader -
Instant Liquidity
As the financier buys the pending invoice receivables the exporter can avoid waiting the usual 60-90 day period to get their payments. Instead, with trade financing like export factoring, they can receive funds immediately into their working capital.
Better Cash Flow Cycle
Since the exporter is getting funds immediately on their invoices they can maintain a healthy cash flow and invest towards expansion.
Collection Management
As the financier purchases the pending invoices from the exporter they inherently take the responsibility of collecting the receivables. This leaves the exporter to focus on their business objectives.
Risk Mitigation
Most Export Factoring options finance up to 80-90% of the pending receivable immediately to the exporter, drastically reducing the risk of payment defaults they might have faced.
Advantage Over Competitors
As we mentioned earlier, the Textile and Apparels Export industry will see significant growth in the coming years. So, businesses that have higher working capital at their disposal to leverage new opportunities will have the upper hand over their competitors.
Why Choose KredX GTX For Your Textiles Export Business?
KredX GTX (KredX’s Global Trade Finance Exchange), is an innovative and fully digital platform that enables Textiles and Apparels Exporters to find post-shipment financing at competitive rates.
Transparent Bidding System:
Discover multiple flexible trade financing options with competitive rates.
Performance Based Financing:
Find non-recourse collateral-free post shipment financing.
Large Pool of Financiers:
Get access to a selection of domestic and international financiers.
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Collateral Free | Non Recourse | Lowest Rates
