Financing of 100 thousand billion tomans of commodity exchange transactions with Gam bonds

According to the financial news report According to Central Bank Public Relations, Hamid Azarmand said: “Commodity exchange transaction instructions have been communicated to the banking network using credit instruments and the necessary infrastructure has been provided, which is expected to be achieved in the second half of this year.”

What are step papers?

One of the measures that the central bank recently implemented was the review and amendment of the guidelines for step bonds; Bonds are a commitment financing tool that had a limited function in production financing due to some problems and limitations.

Under the new guidelines, Gam bonds will be a very efficient tool for chain financing. According to the new guidelines, banks issue promissory notes based on the invoice and at the request of the customers and provide them to the seller of raw materials. From the beginning of issuance to the maturity of the bonds, these bonds will be easily transferable in the chain in order to purchase raw materials.

In addition, there is always the possibility of supplying it in the secondary market. In the new guidelines, the company’s credit limit has been increased up to 130% of the previous year’s sales, and banks have been exempted from regulatory ratios and balance sheet growth control limits. It is necessary to explain that, according to the approvals, Gam bonds are issued only in the central bank system and by banks, and therefore its transparency and monitoring is possible in a suitable way.

Therefore, Gam bonds are considered an efficient financing tool for economic enterprises, which can be used to provide the working capital of economic enterprises without the effects of inflation.

These bonds are issued by the operating banks with a maturity of one to 12 months, and its repayment is also guaranteed by the banks at maturity. The fee for issuing these bonds is the same as the bond fee, and banks are allowed to give their customers a discount on the bond issuance fee.

The beneficiary of the bonds has three options: transfer to a new beneficiary for the purchase of goods and services, discount in the capital market, and keeping the bonds and settlement at maturity.

A higher credit limit compared to bank facilities, the possibility of transfer to the capital market at any time by the beneficiary, the possibility of transfer in the chain easily and without fees, and effective exemptions to encourage companies are among the benefits of Gam bonds.

How has the performance of Gam papers been?

The total amount of bonds issued by banks from February 2019 to the end of October 1401 is equal to 30.2 thousand billion Tomans, of which more than 21.4 thousand billion Tomans are related to the performance of recent months.

Due to the amendment of the GAM guidelines and the incentives considered for the use of this tool, the performance of issuing GAM bonds has increased significantly in recent months and the trend of using this tool is upward.

According to the announcement of the central bank, in the first year of using this tool, only some industries such as automobiles, component manufacturing, and household appliances used this tool; But in the last four months, a very diverse range of economic activities, including automobile industries, component manufacturing, household appliances, food industries, agriculture, pharmaceutical industries, chemical industries, basic metals, metal products, construction materials, electrical and electronic industries, use this tool to provide have used production finance.

Also, the number of banks issuing Gam bonds has increased to 112 and the number of banks active in issuing bonds has increased to 10 banks. Of course, it should be noted that the license to issue Gam bonds has been issued to 24 banks, and the banks with the license to issue Gam bonds can issue bonds through the Gam system and within the framework of the Central Bank’s notified rules.

According to the approvals of the economic headquarters of the government, it has been assigned that at least 20% of the total facilities paid to the production sector this year will be done through chain financing. In order to achieve the aforementioned goal, it has been planned that by the end of this year, at least 100 thousand billion Tomans of commodity exchange transactions will be settled through credit instruments such as Gam bonds, as well as financing the working capital of the chain of oil, gas, petroleum products, Petrochemical and chemical industries, as well as food and agriculture industry chain, at least 100 thousand billion Tomans, using chain financing tools such as Gam bonds.

What is the difference between the chain financing plan and the bonds?

Chain financing is a set of methods and financing operations that lead to the improvement of working capital management of production enterprises. In these methods, various infrastructures and financial tools (such as Gam, electronic bill of exchange, credit card, letter of credit, etc.) are used. Meanwhile, “Gam bonds” are one of the types of financial instruments that can be used to finance economic enterprises. In this regard, it is intended that this tool will be used more widely in chain financing in the near future by correcting and eliminating the shortcomings of the Gam guidelines.

Therefore, tools such as electronic bill of exchange, electronic promissory note, credit card, long-term internal letter of credit, productive credit certificates (GAM) and other financial and commercial tools are virtual, by using which the credit institution can provide chain financing services and credit circulation in Slow supply chain length.