What is a Collateral?
Types of Collateral We Offer:
Bankable Collateral (Monetize):
This is the collateral that will make your leased bank instruments able to be monetized. Unfortunately, most people who lease instruments are not aware that the bankable portion of the instrument does not covey with the instrument. We work directly with one Collateral Provider who has the cash on deposit to provide Collateral for small project (50M USD) as well as providing Collateral for larger projects (2B USD). This collateral is acceptable to get your bank instruments monetized irregardless of which bank issued the instrument.
We issue instrument and monetize it at 100% of face value. After we monetize your instrument you can enter into one of our programs or you can simply take the monetized funds and do as you see fit.
We use our collateral to fund your project. The smallest collateral we issue is 100M. The cost of the collateral is 3M. This 100M of cash collateral that you only pay 3M for will fund projects up to 50M. Our funding is not a loan, there is no repayment required. When we release the funds for your project we also return the 3M collateral fee. If we do not fund you as identified in your contract you can cash the collateral for the amount of funding we promise and for return of the collateral fee. In other words your funding is guaranteed if we accept your project and you participate in our collateralized funding program. When we issue 100M of collateral we are not issuing a promise to pay (BG, SBLC etc). We actually place 100M cash in an account in our bank in your name and the funds are blocked until your funding is released as per your contract or the collateral is cashed by you because we did not perform.
Your funding is 100% guaranteed.
Cash Banked Instruments:
Our collateral transfer facilities enable business owners to access collateral from providers at a fee for a given tenure. The collateral is backed by assets/cash and issued by a financial institution on behalf of an applicant/Fund Manager. Fund Manager agrees (through his issuing bank/financial institution) to issue collateral in the form of (a)demand guarantee (the Bank Guarantee/Standby Letter of Credit) or (b) Letter of Credit towards the Beneficiary in return for a ‘rental’ or ‘return’ known as the ‘Contract Fee’. The parties agree to enter into a Collateral Transfer Agreement (CTA) which governs the issuance of the Guarantee. In the course of the relationship between Provider and Beneficiary, the beneficiary may utilize the collateral for their own purposes which may include; security for loans, credit lines or for trading purposes. At the end of the term, the Beneficiary agrees to extinguish any encumbrance against the Guarantee and allow it to lapse (or return it) prior to expiry and indemnify the Provider against any loss incurred by default of loans secured upon it.
Over recent years, these collateral transfer facilities have become more popular in certain regions as they enable the Beneficiary to have access to substantial credit facilities by using the Guarantee as loan security.
TFC can help you obtain this important financial instrument within a 48 -144 hour turnaround time upon full submission of documents required.