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   Position:  Home >>  Corporate Banking  >>  Financing Services  >>  Bill Discount
 

Bill Discount

Definition

A commercial bill discount is an act by which the legal holder of a commercial bill (including banker's acceptance draft and commercial acceptance draft) transfers it to BOCOM to acquire cash before its maturity date.

Maturity term and interest rate

(1)   The discount period covers the period from the day of discount to the bill maturity date (postponed accordingly if the maturity date falls on a public holiday, but the interest will still be accrued throughout the period of postponement).

(2)   The discount interest rate is subject to the relevant interest rate announced by the People’s Bank of China.

Application conditions

(1)   Fulfill BOCOM’s basic requirements for working capital loan.

(2)   Bona-fide and lawful commodity transactions between applicant and bill-issuer or its predecessor;

(3)   Discounted fund is used as the company’s normal working capital.

Application procedures

1.    Provides related documents required for the application of working capital loan requested by BOCOM.

2.    Provides product sale contract between discount applicant and predecessor, together with the value- added tax invoices;

3.    Fills out a duplicate Application for Acceptance Bill Discount with imprints of company chop and the legal person’s personal chop;

4.    Fills out a Discount Voucher in quintuplicate copies, with imprints of company chop and bank chops on the first copy;

5.    Submits commercial bill prior to its maturity (commercial acceptance draft must be the second copy and bank acceptance draft must be the second and third copies), with completion of transfer endorsement;

6.    Upon review and approval of the discount application, BOCOM will sign contractual documents including discount contract, guarantee contract or mortgage (pledge) contract with the applicant for discount.



 



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