The International Islamic Trade Finance Corporation, member of the Islamic Development Bank Group, has launched its new standalone letter of credit confirmation instrument as part of its strategy to expand its private sector interventions.
ITFC’s newly developed ‘LCs Confirmation’ product is open to small and medium enterprises in IsDB member countries wherein exporters can now rely on ITFC’s LCs Confirmation boosting trade volumes in Organisation of Islamic Cooperation member countries.
The LCs Confirmation product is aimed at managing the increasing risk associated with the coronavirus pandemic while facilitating trade flow and ensuring the steady supply of essential goods.
Commenting on the launch, ITFC Chief Executive Officer, Hani Salem Sonbol, said, ‘ITFC is committed to supporting SMEs and private sector development in developing countries to drive global trade. With this LCs Confirmation instrument, the ITFC is demonstrating the important role that Islamic trade finance products and solutions have in levelling the playing field for developing markets that seek to participate in the global economy.
“This provides much-needed support for exporters, the issuing banks and as a consequence, serves to provide strategic trade finance support where and when it is needed most during the COVID-19 pandemic and beyond.”
The product is structured to allow exporters gain assurance from a multi-lateral financial institution to secure payment, thus mitigating the credit and country risks of the LCs issuing banks.
