Bill operations

In the event of a temporary lack of funds, agree upon deferred payment and pay for the goods by means of a bill of exchange, in order not to disrupt company activity.

Avalisation of bills of exchange

Avalisation of bills of exchange implies guarantee of PrivatBank to pay by bills of exchange of your organisation for you, if for some reason you are unable to effect payment yourself.

  • The avalisation cost is significantly lower that the interest on loans would be.
  • By using avalised bills of exchange you will be able to agree upon deferred payment.
  • The reliability of payments by bill of exchange payments in cooperation with you will become a competitive advantage in the eyes of your suppliers.
  • Bill of exchange transactions are carried out promptly at any of the 3,300 bank branches throughout Ukraine.
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What are bills of exchange and avalisation?

A bill of exchange is a financial instrument of security binding one party to pay a fixed amount to the bill of exchange holder at a predetermined future date or at its maturity.

Avalisation by PrivatBank implies the bank's guarantee to pay by the bill of exchange in event of non-payment by the debtor.

Types of bills of exchange avalisation by PrivatBank:

  • Tax bills - apply to revenue payments for taxes, fees and other mandatory payments;
  • Trade bills - used in the calculations between commercial organisations for goods delivered.

What is needed for bill of exchange avalisation by PrivatBank?

Step 1. Provide the bank with constituent documents, financial statements, documents on the property which can be used as collateral (unless avalisation is covered).

Step 2. Conclude a bill of exchange avalisation contract with PrivatBank.

Step 3. Pay the fee for bill of exchange avalisation. The fee for avalisation of a commodity bill of exchange is calculated based on the bill amount at an annual rate of 3%-5% per annum (for the bill circulation period). The fee for avalisation of a tax anticipation bill is 0.1%-1% of the bill amount. The fee depends on the type of collateral and volume of bills subject to avalisation.

Step 4. Receive your bills of exchange avalised by the bank.

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The fee for avalisation is calculated at an annual rate ranging from 1.2% to 5% per annum for the period of the bill of exchange circulation. The fee depends on the type of collateral and volume of bills subject to avalisation.

  • Receiving bills for payment of legal drawer
  • Making payments on promissory notes
  • Privatbank's return of cancelled bills to drawer.
  • The avalisation by PrivatBank of a bill of exchange significantly enhances the instrument's favour, while certifying its 100% liquidity
  • The Drawer communicates only with PrivatBank, and not with all holders of promissory notes.
  • The holder of an instrument may present a bill at any branch of PrivatBank and receive the funds the same day.
  • On account domiciliation can not be seized, penalties imposed etc.
  • Funds that are credited to the domiciliation can be used to pay bills or returned at the request of the Drawer on his client's current account.
  • Balances which are left on account accrue extra interest at current deposit rates.
  • A domiciled bill can be passed from owner to owner, and each of them can either get money under the bill to your account, or further transfer/sell on the bill.