BAFT-IFSA has just published some new definitions of traditional trade finance

BAFT-IFSA has just published some new definitions of traditional trade finance to facilitate dialogue with regulators and governments.

These definitions now grade trade finance risk according to a series of “risk clusters”. The ITFA has made the following comments to the international trade finance press on these definitions: ” The Risk Clusters are a very practical and commercial way to show the intrinsic amount of risk attached to each trade finance product. It is a helpful guide, not just to regulators, but also to banks who maybe are just starting to use these instruments. Forfaiting has rightly been accorded a place in Risk Cluster A reflecting its widespread use and very low risk. A link to these definitions is included in the Member Area Resources section of the website.”