How to Build a Career in Trade Finance

Exporters and importers might not always know their business partners well, and may not feel comfortable trading without the guarantee they will receive the right goods or a guarantee of payment. In some instances, exporters might also require financing to close the gap between receiving payment and providing the necessary goods and services. In either case, Trade Finance presents the ideal solution, helping to reduce the most common international trade risks such as non-payments, currency fluctuations, political instability, etc.

As over 80% of global trade currently relies on Trade Finance, it represents a large and continuously evolving sector that could offer a number of interesting positions with the possibility of a prosperous future. If you’re interested in international commerce and the global economy, Trade Finance can be a fantastic opportunity, and here is how you could build a successful career in this field:

What is Trade Finance?

Trade Finance represents a set of services and products that authorise business transactions between companies that engage in international trade. It is most commonly offered by banks and other financial institutions that serve as intermediaries between two businesses and ensure the collection of trade receivables.

In this process, the lenders provide clients with financial resources and the necessary cash flow, with the goal of minimising the risk of potential losses. Financial institutions have various products and financial instruments at their disposal that allow them to achieve this, along with signed contracts with clients that comply with all international and local regulations.

What do Trade Finance professionals do?

Considering the fact that Trade Finance is quite a broad field, there are several different roles you could choose from, all of which require extensive knowledge and skills. For example, you could be part of the operations staff, who review guarantees and letters of credit, work directly with customers, and ensure all necessary payments are made on time. These individuals also examine potential suspicious transactions, making them act as important protection from financial crime.

On the other hand, you could also work as a sales manager, the one that meets with clients, talks to them about their respective market and potential issues they might face, and offers viable solutions. Or, you could become a product manager, the person who knows markets, trends, and products well, along with defining strategies and developing new efficient solutions. No matter which career path you choose, chances are you will be able to work anywhere in the world as a qualified professional, most likely in the Trade Finance department of a lender or a company that deals in exporting and importing goods and services.

The importance of Trade Finance

Trade Finance makes international trade possible and is crucial for securing the delivery of goods and services among the specific parties that are involved in international trade. It helps to reduce some of the most common risks tied to exporting and importing and thus positively contributes to the economy, especially in terms of emerging markets.

And if the best Trade Finance solution is chosen, it will provide even more benefits. With this option, businesses are given access to a convenient line of credit allowing them to pay any supplier around the world, which strengthens international relationships, increases purchasing power, closes the working capital gap, gives the power to diversify, and encourages companies to go global.

How to become an industry professional

While many companies might offer in-house training in Trade Finance to their employees, it’s recommended to get professionally qualified in an effort to expand your knowledge, develop your skills, and progress your career successfully. There are a number of qualifications you could opt for, covering different areas of interest. If you’d like to work on your technical skills concerning guarantees and documentary credits, for instance, you might want to consider acquiring the Certificate for Specialists in Demand Guarantees (CDSG) and the Certificate for Documentary Credit Specialists (CDCS).

In case your interests lie more in the front-office, client-facing roles, then the Certificate in Supply Chain Finance (CSCF) and the Certificate in International Trade and Finance (CITF) might be better suited to your aspirations. Regardless of the certificate you select, keep in mind that it typically takes around six months to complete these qualifications, whether you opt for online courses or traditional education.

Additional helpful qualifications

Being an international industry, Trade Finance requires daily communication with clients from all over the world. As knowing the language of the clients you are doing business with can lead to better understanding and more successful trade, you will likely be a more desirable candidate for a prosperous position if you are fluent in more than one language.

Similarly, international transactions also require compliance with local and international laws, while violations of these regulations could lead to significant losses to all parties involved. For this reason, most Trade Finance teams work closely with legal teams in order to effectively reach their goals. While you don’t necessarily need to become a lawyer to succeed in Trade Finance, having some knowledge of international law and regulations could be of great help.

Even though a career in Trade Finance is complex and highly responsible, it is also an incredibly prosperous and rewarding field. As long as you have the right qualifications and soft skills, as well as enough motivation and initiative, a successful Trade Finance career will be guaranteed.