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Packing credit

Sachin Golande (Article) (25 Points)

08 June 2016

Please tell me the concept of Packing Credit.

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Ajit Hegde (CA - Final) (1367 Points)
Replied 09 June 2016

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packing credit
A borrowing facility provided by a financial institution to help an exporter finance the costs of buying or making a set of products, and then packing and transporting them before shipment occurs. A packing credit loan will often be extended if a letter of credit has been issued by a purchaser of the products that is based in another country or a confirmed order for exporting the goods exists. Packing credit is available in foreign currency also. Since for some products packing cost is as high as the cost of the product, such facility is given by the banks