HSBC Holdings Plc is offering a new loan product to US companies struggling to cover the cost of President Donald Trump's tariffs that have roiled international supply chains.
The London-headquartered bank said on Wednesday its TradePay platform was being extended to directly cover the cost of tariff payments, allowing importers to effectively borrow to meet the increased expenses involved in shipping products into the US.
“By settling import duties directly and frictionlessly through HSBC TradePay, our US clients have more visibility and control over their working capital,” said Vivek Ramachandran, head of global trade solutions at HSBC.
Under the new loans, customers' import payments will be automatically paid through pre-agreed credit with brokers or a direct deduction using automated clearing house credits, meaning companies will be better able to manage their cash flow and settle duties more efficiently.
HSBC is the world's largest trade bank and the biggest international bank in China, giving it a crucial role in oiling the wheels of international trade, particularly between the two biggest economies. The US has imposed tariffs as high as 145% on Chinese goods, while China has hit back with retaliatory rates of 125%. Talks aimed at de-escalating the situation are due to take place this week.
Speaking last week, HSBC Chairman Mark Tucker said world trade was facing a “period of deep and profound change.”
“The over-arching impact of the changing approach to global trade relations has been to increase economic uncertainty with serious potential risks to global growth,” said Tucker.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
