Positive economic indicators push import finance to the fore

Reichmans targets small to medium-sized clients
KEVIN MAYHEW
LOW INTEREST rates, the strength of the rand, and the emergence of Asia’s super economy, China, have increased the need for trade finance in South Africa – primarily for imports.
Howard Tradonsky of Johannesburg-based ReichmansCapital says that existing traditional banking structures and mechanisms have not been flexible enough to meet the immediate trade finance needs of importers and of exporters. This is especially apparent when dealing with smaller to medium sized businesses trying to take advantage of the changing global challenges associated with South Africa’s current economic and currency situation.
“On the exports side, the negative impact of the strengthened rand has not been so pronounced where business is priced in Euros, so there is still a call for export related finance to Euroland. However, there has definitely been a need for some rapid growth in import financing for products from a number of regions, with China being the most pronounced,” he explained.
ReichmansCapital is a wholly-owned subsidiary of Investec Bank, and focuses on international trade finance business.
Acquired in South Africa in 1990, the division’s clients are small to medium sized owner-managed businesses seeking trade, asset and debtor finance for working capital, funding for the acquisition of assets and to facilitate growth.
It lends to clients whose businesses have been running for at least three years, according to Tradonsky, or where the owner-manager has considerable industry experience.