Financing products tailored to industry specifics general discounting facility works for perishable exporters

RAY SMUTS LOCATING ITS headquarters at Stellenbosch has stood Anglo African Trading in good stead, enabling it to remain ‘close to the ground’ by building a strong relationship with the fruit and wine industry. Dr Hendrik de Waal, head of Treasury at Anglo African Trading, explains products like wine and commodities are exported on a fixed price basis in which case conventional trade finance solutions can be applied. Fruit and similar industries such as fish however work on a consignment principle where prices are determined once the product has reached the overseas market, creating a problem from a conventional trade finance point of view. “Anglo African Trading has developed and successfully implemented new, dynamic financing products that are tailor-made for these industries. “Some of the products like our general discounting facilities not only supply a financing solution for the fruit industry but have given a new dimension to the product list available to our clients,” says Dr De Waal. Anglo African has been providing trade finance to the import and export community throughout the country for the past five years. Its repertoire of products ranges from the issuing of LCs and taking out forward cover for imports to the acceleration of export proceeds and the discounting of local invoices. De Waal says while logistics finance comprises a large part of the business, the product that has grown most is the company’s general discounting facility originally designed for the export fruit industry and running successfully in the market for more than four years, providing a number of advantages to the perishable exporter. These include flexible prime-based funding, central treasury functionality, competitive exchange rates, efficient reporting on all foreign receipts and hedging instruments. Given that many of Anglo African’ s finance products were initially developed for industries in the region, it has become very active in these areas and developed a very good relationship with the perishable export industry. “This,” says Dr De Waal, “is something we would like to grow further in the future.”