Pay suppliers, then get paid
Trade Finance and Stock Finance
Trade finance pays your suppliers upfront, in the UK or overseas, and gives you time to sell the goods before you repay. It's used by importers, wholesalers, retailers and manufacturers who need to buy stock before their customers pay them.
Funding Plus compares trade and stock finance lenders, including facilities that pay overseas suppliers in their own currency.
- Pay suppliers upfront
- Repay after you've sold the goods
- UK and international suppliers
Reviewed by the Funding Plus team · Last updated October 2026
Step 1 of 3 · Trade Finance
How much do you need?
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Trade Finance at a Glance
- Facility size
- £50k – £10m+
- Terms per deal
- 30 – 180 days
- Set-up
- 1 – 4 weeks
- Security
- The goods
- Best for
- Importers and stockists
Typical figures across the market. Your offers depend on your business, the lender and the security available.
How Trade Finance Works
- 1Place your orderAgree the order with your supplier as normal.
- 2The lender pays the supplierOften directly, and in the supplier's currency if needed.
- 3Goods arrive and you sell themYou have the agreed term to sell and collect payment.
- 4Repay the lenderYou repay the amount plus fees when the term ends, often from your sales.
How Much Does Trade Finance Cost?
Trade finance is usually priced as a percentage per 30 days on each transaction, plus facility fees. The faster you sell the goods and repay, the less it costs.
- A fee per transaction, often per 30 days
- Facility or arrangement fees
- Currency exchange costs on overseas payments
- Insurance on goods in transit
Worked example
An £80,000 stock order
- Supplier payment
- £80,000
- Rate
- 2% per 30 days
- Time to sell and repay
- 60 days
- Cost
- £3,200
- Total repayable
- £83,200
Illustrative only, not a quote. Excludes facility fees and currency costs.
Who Can Get Trade Finance?
- Confirmed orders or a strong sales track record
- Reliable suppliers
- Gross margins that cover the cost of finance
- Usually 2 or more years' trading
- Turnover from around £500,000 a year
What You'll Need to Apply
- Supplier invoices or pro-forma invoices
- Customer orders or sales history
- Latest accounts
- Details of shipping and insurance
Pros and Cons of Trade Finance
Advantages
- Buy more stock than your cash allows
- Win larger orders
- Supplier discounts for paying early
- Keeps cash for running costs
Things to watch
- Only works with good margins
- Delays in selling increase costs
- Paperwork for each transaction
- Larger facilities need a track record
Types of Trade Finance
Supplier finance
The lender pays your suppliers and you repay on extended terms.
Stock finance
Funding secured on stock held in your warehouse.
Letters of credit
A bank guarantee that your overseas supplier will be paid once conditions are met.
Trade Finance vs Other Options
| Option | Best for | Typical speed | Security |
|---|---|---|---|
| Trade finance | Paying suppliers upfront | 1 – 4 weeks to set up | The goods |
| Revenue-based finance | Online sellers buying stock | 1 – 7 days | None |
| Invoice finance | B2B sales on credit terms | 1 – 3 weeks to set up | Your invoices |
| Business line of credit | Smaller, regular purchases | 1 – 5 days | Usually none |
Who Uses Trade Finance?
Trade finance suits businesses that buy goods before they're paid for them.
Customer story
“[Real customer story for Trade Finance: what they needed, how quickly it was arranged and what it let them do.]”
[Name], [Role], [Business name] · [Amount] trade finance
Trade Finance FAQs
What's the difference between trade finance and stock finance?
Trade finance focuses on paying suppliers for specific orders. Stock finance lends against stock you already hold.
Can it pay overseas suppliers?
Yes. Many facilities pay suppliers abroad, in their own currency.
Do I need confirmed customer orders?
Not always, but they help. Lenders want confidence the goods will sell.
How long can I take to repay?
Usually 30 to 180 days per transaction, agreed upfront.
Is there export finance too?
Yes. UK Export Finance and some lenders support businesses selling overseas.
Related Guides
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