Absa | Compare international business banking products

Foreign currency transactions

Solution

Monthly Fee

Key Features

The Spot Market

Ideal for businesses dealing in currencies other than the rand
Payment is done at spot
Rate determined at the point of sale
The acceptance of a rate is binding
Caters for diverse commercial and financial transactions

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The Forward Market

Buy or sell foreign currency on a future date
Ideal if you deal in international products and services
Ideal if you make or receive international payments
Fix your rate in order to price accordingly
Hedge your exposure against rate fluctuations

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Alternative Hedging

You have the right but not the obligation to buy or sell within a given time frame
Ideal for companies with hedging policies
Get better forex rates than Contracts and Foreign Exchange Spot
Protection against currency rate movements

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International trade

PRODUCT

Monthly Fee

Benefits

Key Features

Export Documentary Collections

It’s a simple operation
It improves cash flow
Customers using an Export Collection where the bill has been guaranteed may request us to discount the bill before due date
It is convenient – has no impact on the client’s credit facilities
Reduces the risk of losing the title to the goods before receiving payment for goods shipped on a bill of lading (a detailed list/receipt of goods being exported

Export Documentary Collection operates as follows:

The exporter sends documents that allow access to the goods being imported (i.e. a bill of lading, certificate of origin, invoice) to their bank, along with a bill of exchange requesting payment according to the agreed terms
Payment is normally requested in one of two ways:
Immediately on presentation of the collection to the importing customer ('sight payment'), or
On an agreed future date ('term payment')
In the case of term payments, importing customers will be required to endorse the bill of exchange (ie. sign it, usually on the back) to indicate their acceptance of it before we release to them the documents allowing access to the goods.
Our Export Documentary Collections are governed by International Chamber of Commerce rules; this means that aspects such as responsibilities and liabilities are clearly defined and standardised worldwide.
If the correspondent bank (collecting bank) has guaranteed payment of the bill of exchange we can discount the bill of exchange without affecting our client’s facilities. This allows them to improve their cash flow by receiving funds earlier than the due date. In this case, our risk is marked against the collecting bank.

Import Documentary Collections

It’s a simple and efficient tool for settling trade debts
It improves cash flow for customers who are able to negotiate credit terms
Payments of any value may be made in any freely traded currency
Payment can be made immediately on presentation of the documents or on an agreed future date.

The exporter sends documents that allow access to the goods being imported (i.e. a bill of lading, certificate of origin, invoice, etc.) to their bank, along with a bill of exchange requesting payment according to the agreed terms
Payment is normally requested in one of two ways: immediately on presentation of the collection to the importing customer ('sight payment') or on an agreed future date ('term payment')
In the case of term payments, importing customers will be required to endorse the bill of exchange (ie. sign it, usually on the back) to indicate their acceptance of it before we release to them the documents allowing access to the goods.

Export Documentary Letter of Credit

The Export Documentary Letter of Credit offers you with a comprehensive range of international trade services to support your overseas trading
'gateways' to a whole range of other international products and services such as foreign exchange products and risk mitigation
you can secure a specific payment date

Payment is only made to exporters when they present documents that comply exactly with the terms and conditions of the Documentary Letter of Credit
The exporter may be able to discount deferred Letter of Credit, thus receiving their payment immediately upon presentation of complying documents
No impact on the exporter’s credit facility. Even if we discount the Letter of Credit, the risk will be on the issuing bank
Letters of Credit can be issued for any value and in any freely traded currency (subject to appropriate facilities having been marked for the customer)
Sight or term payment options
Payment can be received immediately on presentation of compliant documents ('sight' payment) or on a fixed or determinable future date ('term' payment)

Import Documentary Letter of Credit

Our Import Documentary Letters of Credit provide you with valuable risk mitigation tools to assist with your international trade transactions.
By using an Import Documentary Letter of Credit, you can mitigate the risks of your supplier shipping incorrect or defective goods
Import Documentary Letter of Credit are governed by International Chamber of Commerce rules which means responsibilities, liabilities are clearly defined and standardised worldwide
We offer a comprehensive range of international trade services which allow you to strengthen relationships with your overseas suppliers
Trade services products, such as letters of credit and collections, often act as 'gateways' to a whole range of other international products and services such as foreign exchange products and risk mitigation. Income benefits can be extensive.
As an importer you’re assured that if the terms of Letter of Credit are complied with, you’ll receive the correct goods on time

Customers can specify the documents against which payment will be made
Suppliers receive payment only if they present documents which comply exactly with the terms set out in the letter of credit
While a letter of credit cannot guarantee the quality of the goods, it can call for an independent third party to inspect the goods prior to shipment and provide documentation detailing the inspection findings. This is an important advantage when buying from new suppliers
We can offer guidance on the documents to ask for, and how to word the terms of a Letter of Credit
Our letters of credit are always irrevocable – they cannot be amended or cancelled without the agreement of all the parties
The bargaining position of customers is enhanced - customers may be able to negotiate longer credit periods when they provide letters of credit
They may also be able to reduce their costs by using the benefits to the supplier as a lever in negotiations
We can establish the Letter of Credit at sight (enabling beneficiary to get paid upon presentation of complying documents), and refinance the importer for a further period (i.e. allowing him to pay for his imports at a future date and also to sell the goods before he has to pay). This improves our client’s cash flow situation, and also allows him to negotiate better pricing with the exporter
Suppliers may also be persuaded to meet some or all of the cost of the letter of credit
Customers can gain status with their suppliers because banks only issue letters of credit on behalf of customers they consider creditworthy
Customers' competitive position may also be enhanced; they may be able to win deals from suppliers who insist on payment by letter of credit

Customer Foreign Currency Account

Solution

Monthly Fee

Key Features

Electronic Transfer (SWIFT)

Ideal for businesses dealing in currencies other than the rand.
Payment is done at spot (usually within two business days).
Rate determined at the point of sale.
The acceptance of a rate is binding.
Caters for diverse commercial and financial transactions.

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Absa Online for Business

You enter into an agreement with us to buy or sell foreign currency at a future date
Ideal for businesses that make use of international products and services
Ideal for businesses making or receiving international payments
You can fix your rate in order to price accordingly
You can hedge your exposure against rate fluctuations

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Send and receive money

Solution

Monthly Fee

Key Features

Customer Foreign Currency Account

Ideal for businesses dealing in currencies other than the rand.
Payment is done at spot (usually within two business days).
Rate determined at the point of sale.
The acceptance of a rate is binding.
Caters for diverse commercial and financial transactions.

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Travelling abroad

Solution

Monthly Fee

Key Features

Foreign Bank notes

Whenever you travel to another country, it is always a good idea to have some cash available in the currency of the country you are visiting, for that coffee, taxi fare or hotel porter tips.
At Absa we can supply you with most of the world’s major currencies before you depart, saving you having to stand in queues at the airport to get the currency of your choice.

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Cash Passport

You need a valid ID book, a passport and an air-ticket or e-ticket in your name to qualify for a Cash Passport.
If you are travelling by car or to countries that are not in the common monetary area, you will need to provide your ID and your vehicle’s registration certificate.
If the currency of your Cash Passport differs from the currency of the country you plan to visit, additional service fees will apply.
As an alternative to cash passport you can use your Absa Debit or Credit Cards.
Lost or stolen cards can be replaced.
Additional cards can also be purchased for family members linked to the same pot of funds, for convenience.

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Omnibus travel facilities

We may approve applications for Omnibus Travel facilities up to R20 million per calendar year
Your application for an omnibus travel facility must be accompanied by an official letter from your company authorising the proposed business visits
We keep a schedule of the visits undertaken, the amount of foreign currency allocated and resold
For inspection purposes all documentation must be retained for five years
The omnibus facility may not be deposited in foreign bank accounts
Travel allowance can be provided in the form of Foreign bank notes or Cash passport
Applications for omnibus travel facilities over R20 million must be submitted to the Financial Surveillance Department for consideration

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