The Current Status And Resolutions Of Domestic Trade Financing In Chinese Commercial Banks

Trade finance is an off balance sheet business of commercial banks. Incorporating unique characteristics of each transaction into product designing,a commercial bank can capture a sizable profit while bearing lower risks when providing trade finance.On the other hand,trade finance facilitates the international or domestic trade by satisfying different capital demand through the whole transaction. So,trade finance creates win-win cooperation for a commercial bank and its clients.However,commercial banks have maintained a sharp focus on international trade since trade finance was launched.With the increasing demand for domestic trade financing and saturated market for traditional loans,the competitive capacity in domestic trade financing is to be critical for a commercial bank to be successful in the future.The author structures this paper as follows.Firstly,the author clarities several definitions and characteristics related to domestic trade financing,compares this innovative business with the traditional loans, and introduces the primary products of domestic trade financing.Secondly,the author discusses the current development of domestic trade financing,and then makes some valuable recommendation based on macroeconomic and microeconomic analysis and some practices of the trade financing in foreign commercial bank.