Post-shipment finance calculator
Assess the finance an exporter needs between shipping the goods and the buyer paying: the exports the bank funds, spread over the collection cycle. Figures in ₹ lakh.
Post-shipment limit with this bank
Exports funded = Projected exports − Margin − Advances. Cycles = Days in a year ÷ (Credit period + Transit time). Eligibility = Exports funded ÷ Cycles. Post-shipment credit runs for the usance period plus the normal transit period, within an overall limit of 365 days.
This calculator is for learning. Banks apply their own policies, margins and benchmarks, so treat the result as a guide, not a credit decision.
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What post-shipment finance funds
Once goods are shipped, the exporter waits for the buyer to pay: for the documents to travel, and for the credit period the buyer has been given. Post-shipment finance bridges that gap. The bank purchases or discounts the export bills (foreign bills purchased or discounted, FBP or FBD), or gives post-shipment credit in foreign currency (PSCFC), and is repaid when the buyer pays.
Post-shipment credit runs for the usance (credit) period plus the normal transit period, within an overall limit of 365 days from shipment.
How to use this calculator
- Enter the projected exports for the next 12 months.
- Enter the exporter's margin and any advances from buyers.
- Enter the cycle: the credit period given to buyers plus the transit time for documents.
- Deduct any post-shipment finance from other banks.
The formula
- Exports funded by the bank = Projected exports − Margin − Advances
- Cycles in a year = Days in a year ÷ Cycle days
- Post-shipment eligibility = Exports funded ÷ Cycles
- Limit with this bank = Eligibility − Finance from other banks
Unlike packing credit, which funds the cost of making the goods, post-shipment finance is based on the export value of the bills.
Worked example
Projected exports of ₹1,000 lakh, a 10% margin and ₹300 lakh of advances leave ₹600 lakh for the bank to fund. Buyers get 75 days' credit and documents take about 15 days, a 90-day cycle:
- Cycles in a year: 360 ÷ 90 = 4
- Post-shipment eligibility: 600 ÷ 4 = ₹150 lakh
- Less ₹50 lakh with another bank: limit ₹100 lakh
Frequently asked questions
Does an LC change the assessment? Bills under a letter of credit from a sound bank carry less risk, so banks are often more comfortable with them. The limit is still sized on the collection cycle.
What if buyers pay late? Overdue export bills are a warning sign. Banks track them closely, and repeated delays can reduce the limit or lead to a demand for ECGC cover.
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