Accord Financial Ltd., a subsidiary of Accord Financial
Corp. (TSX:ACD), has launched AccordOctet, a unique trade
finance solution aimed at Canadian manufacturers and importers
sourcing goods from suppliers in Asia. “This innovative program is
a great tool for exempt market dealers and advisory firms working
to put together a complete financing strategy for their clients.
AccordOctet unlocks capital and financing sources otherwise tied
up in their supply chain, without straining their client’s existing
bank lines,” says Simon Hitzig, President of Accord.
Approved clients are offered an unsecured line of credit,
strengthening their purchasing power without interfering with
their existing financing facilities. The program provides quick
payment to their Asian suppliers, while still allowing Canadian
based importers up to 90 days to settle their purchases. And it
eliminates the need for letters of credit. AccordOctet is backed by
a secure state-of-the-art online portal, connecting the importer,
their Asian suppliers and Accord, enabling a seamless flow of
documentation and funds.
AccordOctet eliminates the challenges faced by importers
who are frustrated by language barriers, financing setbacks,
excessive paperwork, and suppliers in China, Hong Kong and
Taiwan who require guaranteed payment before going into
production. “Our new program provides a flexible finance and
logistical tool that solves these problems, allowing clients to
maximize trade flows and opportunities for growth,” says Hitzig.
“The requirement for guaranteed payments by Chinese
suppliers is perhaps one of the biggest challenges for Canadian
businesses, many of which do not have ready access to bank-issued lines and letters of credit,” says Aiman Dally, CEO of
Toronto-based Copia Financial Solutions.
As well, “small and medium-sized Chinese manufacturers
find it difficult to obtain loans from state-run banks, which
typically lend only to large corporations, many of which are also
state run,” adds Dally. These manufacturers are forced to rely
on the unregulated, underground lending market which charges
exorbitantly high interest rates. As a result, there is intense
pressure for guaranteed or early payments from importers – a role
that AccordOctet fulfills.
Hitzig says: “with AccordOctet, there are no hassles, no
delays, no letters of credit; payment is made the next business
day, keeping the supplier happy and providing the Canadian
importer with an opportunity to gain preferred buyer status;
enhanced negotiating power; and supplier loyalty.”
Using an encrypted transaction card, clients can review and
authorize transactions online and Accord pays their suppliers the
next business day. Clients then have up to 60 days interest-free to
repay Accord. Importers pay only a small transaction fee, similar
to a merchant fee on a credit card, which can often be negotiated
with the seller. Up to 50% of the advance can be deferred for
an additional 30 days but will be subject to an interest charge.
AccordOctet is as simple to use as a credit card and works in
much the same way.
The AccordOctet program manages each step of the purchase
order and settlement process based on agreed commercial terms.
The secure portal incorporates document tracking and an upload
facility for the entire supply chain cycle, including purchase
orders, proforma invoices, invoices, inspection certificates and
bills of lading, and maintains detailed historical information
on prior transactions, including uploaded documentation
and authorizations. It also provides real time account details,
including: credit limit, available credit, current balance, exchange
rates, interest rates, upcoming payments, fees and charges and
is available in English and Chinese.
For now, AccordOctet is the only trade financing solution of
its kind in Canada.
For more information visit www.accordfinancial.com or call
Simon Hitzig at 1.888.966.2838.
By Dwarka Lakhan, MBA, FCSI, FICB
to help trade with Asian suppliers
The program is already a proven success.
It was pioneered in 2008 by Hong Kong-
based Octet Trading Limited and has grown
to nearly 1,200 members transacting from
China, Hong Kong and Taiwan into Australia.