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Bill of Exchange financing from Finnvera

Bill of Exchange financing can be granted to capital goods exporters from Finland who offer a payment period of 2–5 years to foreign buyers as part of export transactions, and this payment period is documented with bills of exchange.

This is how Bill of Exchange financing work

There are two types of financial instruments that can be used to finance export transactions, namely bills of exchange drawn by the exporter and accepted by the buyer or promissory notes issued by the buyer. Which one is used depends on the laws and bill of exchange practices of the buyer's country.

Bills of exchange and promissory notes are transferable financial instruments i. e. debt obligations. Finnvera purchases the bills of exchange signed by the buyer from the exporter. By signing the bills of exchange, the buyer undertakes to pay the amount of each bill of exchange on its due date to the exporter or its order. After the delivery of the export product, the bills of exchange are discounted by Finnvera and Finnvera pays the discounted price to the exporter. 

The buyer pays the bills of exchange semi-annually. Each semi-annual payment is documented with a separate bill of exchange. For example, if the payment period is 2 years, there will be 4 bills of exchange. 

The benefits of Bill of Exchange financing

Bill of Exchange benefits both the export and the buyer.

Benefits for exporters

  • Boost your trade negotiations – offer financing to buyers in cooperation with Finnvera.
  • Gain a better understanding of your buyer’s creditworthiness.
  • Bill of exchange financing will not burden the exporter's balance sheet, unlike the long payment period granted to the buyer by the exporter with an invoice.

Benefits for buyers

  • Long, 2–5-year, payment period.
  • Unsecured financing.
  • A new source of financing that allows you to expand your financing base.

Check the availability in the buyer’s country

Each country has its own legislation regarding bills of exchange and promissory notes. For this reason, Finnvera must ensure that the bills of exchange and promissory notes are legally binding and enforceable debt obligations in the buyer’s country before any financing may be granted.

Please contact Finnvera to check the availability of of these financial instruments in the buyer’s country.

Bill of Exchange

A bill of exchange is a credit document drawn and signed by the exporter and delivered to the buyer for acceptance. By signing the bill of exchange, the buyer accepts its payment obligation and undertakes to pay the amount of the bill of exchange to the exporter or its order on the due date.


Promissory Note

A promissory note is a credit document issued by the buyer. With its signature, the buyer undertakes to pay the amount of the promissory note to the exporter or its order on the due date. 


Terms and conditions for bill of exchange financing

  • The maximum amount of credit is approximately EUR 2 million.
  • Credit period 2–5 years, buyer repays the credit semi-annually (i.e. at least 4–10 bills of exchange are made).
  • Credit currency typically EUR.  
  • The instrument: bill of exchange or promissory note.
  • Financing is possible when the exporter has delivered the export product to the buyer in accordance with the export contract.
  • The export transaction must meet a sufficient degree of Finnish content.
  • The buyer must pay the exporter an advance payment of at least 15% of the export contract.
  • Financing is subject to the terms of the OECD Arrangement.

Stages of the process



Exporter's costs:

  • Handling fee (incl. credit information) EUR 500–850, depending on the amount of the credit.

Buyer’s costs:

  • The financing is subject to a fixed interest rate, which is determined on the basis of e.g. the buyer’s risk category and funding and administrative costs. All financing costs are included in the aggregate amount of the bills of exchange.
  • Law firm fees and any other costs arising from the financing.

Exporter's risks

Risks related to manufacturing period and the payment under the export contract

The financing is confirmed only after the delivery of the export product and the creation of the bills of exchange. Finnvera may withdraw financing if, for example, there are material deteriorations in the buyer's country or business, or if sanctions imposed would prevent financing. The exporter should make sure, that the buyer’s payment obligation to pay the purchase price under the export contract is valid and that the exporter receives the buyer’s payment at the right time even in the event that the bill of exchange financing cannot be realised. The exporter must ensure that the risks related to production and scheduled payments are covered before the export contract is signed, for example with Finnvera’s Credit Risk Guarantee.

Interest rate risk between the creation of the bills of exchange and the date of financing

The final price of the bill of exchange financing will only be determined when the financing agreement is signed. The exporter bears the interest rate risk that arises between the making and financing of the bills of exchange, and the exporter must acknowledge this interest rate risk in its pricing. The earlier the bills of exchange are created during the process, the higher the interest rate risk the exporter is exposed to. On the other hand and from the perspective of committing the buyer to the deal, the exporter may benefit from signing the bills of exchange at the earliest possible opportunity.

Things to note when concluding an export contract

When using bill of exchange financing, the parties should ensure that the export contract is suitable for this type of financing.  The exporter should carefully consider the following:

  1. The effective date of the export contract, the delivery date and the date of creation of the bills of exchange. It is in the exporter’s interest to be in possession of bills of exchange signed by the buyer before the delivery or at the latest before the buyer takes possession of the export product.
  2. Hiring a law firm:
    • The export contract should specify who will pay the costs of the foreign law firm used by the financier in bill of exchange financing (typically the buyer).
    • The exporter should also consider hiring their own law firm to assist in concluding the export contract
  3. Choosing a delivery clause:
    • The bills of exchange may be discounted to the exporter only after the delivery has taken place in accordance with the terms of the export contract, and the risk has been transferred from the exporter to the buyer in accordance with the Incoterms. In addition, exporters typically favour C-clause terms of delivery in these types of deliveries to ensure e.g. the availability of transport documents.

Financing for exporters during manufacture

If an exporter requires financing during the manufacturing process, they must typically apply for it from a bank. Finnvera may consider participating in the financing if the exporter does not have sufficient collateral to secure the financing. Finnvera’s guarantee coverage is typically 50–80%.

Buyer’s potential exchange rate risk

Bill of exchange financing is mainly granted in euros (EUR). If the buyer’s principal income is in a different currency than the currency of the bills of exchange, the buyer should consider the need for securing itself against exchange rate risks and, if necessary, discuss the matter with e.g. their bank.

Application and necessary information

Finnvera encourages the exporter to get in touch at an early stage of the process.

The exporter applies for the bill of exchange financing. If necessary, the same application can also be used to apply for Finnvera’s Credit Risk Guarantee to cover the risks preceding the discounting of the bills of exchange.

Finnvera assesses the buyer’s creditworthiness and export transaction and requests the following information for its assessment:

Frequently asked questions

Check out the questions and answers about export financing and the Bill of Exchange financing. 

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