With a three-party agreement signed by the supplier, the dealer and the bank, the bank provides loans to the dealer on condition that the bank holds the commodity drawn right.

Service Procedure

1.	The supplier, the dealer and the bank sign a three-party agreement;
2.	The dealer lodges a guaranty fund worth 30 percent of the face value of a draft to be established; the bank then establishes a banker’s acceptance draft with the dealer as the issuer, while the supplier as the beneficiary; the bank notifies the supplier to release goods worth 30 percent of the face value of the draft to the dealer;
3.	The dealer recoups payment for goods, and deposit it into a special account for guaranty fund;
4.	The bank notifies the supplier to release to the dealer goods worth the newly added guaranty fund;
5.	Repeat Step 3 and 4 until the balance of account for guaranty fund equals to the face value of the draft;
6.	Upon maturity of the draft, in case there is no sufficient balance on the account for guaranty fund, the dealer repays the difference to the bank on due date.

Service Advantages

For the Supplier:
·Closer partnership with the dealer;
·Less bank financing and lower cost for capital fund;
·Collection in advance, and flexible fund use;
·Increased sales.

For the Dealer:
·Closer partnership with the supplier;
·Funds in pre-payment for exclusive sales secured;
·Possible to obtain higher commercial discount, as well as lower sales cost.