Exploring the Role of International Trade Finance in Facilitating Global Trade: A Mixed-Methods Study

Description

Exploring the Role of International Trade Finance in Facilitating Global Trade: A Mixed-Methods Study.

Abstract

Now, selling goods to international markets is increasing to expand the business globally. This process brings many risks, such as cash flow issues and buyer payment delays. So, trade finance evolves to help businesses manage risks and access more markets. With the help of technology, the process becomes more efficient and inclusive. It is a set of financial instruments and techniques used to mitigate the risks of both buyer and seller and secure favorable compensation terms. It became popular by providing payment guarantees and letters of credit. .

As global commerce becomes complex, trading options turn into a vital aspect for small-scale businesses. This study paper employs mixed tactic to examine the effect of international trade finance on payment flows, market access, and economic stability. Here, a quantitative approach used to analyze the hidden trends in trade financing with the help of information which is collected from trading companies. However  this helps to understand the relationship between financial instruments and trade flows. The qualitative approach with trading professionals, business owners, and policy maker’s aids in collecting insights into the real-time challenges and opportunities in the field.

The findings highlight how instruments such as letters of credit, commerce credit, and insurance mitigate risks and foster growth in international trade. The study also finds barriers while accessing the trading process, especially in emerging markets. The results from the mixed methodologies shed light on strategic decisions to perform trade finance effectively. The paper also explores the impact of regulatory frameworks on its facilitation. The trends such as credit access, interest rate, and payment terms act as influence factors. With the help of this, the research offers an empirical understanding of how trade-finance supports or constrains global autonomy and drives global wealth.

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