Publisher Summary Forfaiting or without-recourse financing is a method of trade finance whereby the forfaiting bank purchases, on a without-recourse basis, unconditional debt obligations arising from the provision of goods and/or services which are due to mature at a future date. In a forfait transaction, the exporter agrees to surrender the rights to claim for payment of goods or services delivered to an importer under a contract of sale, in return for a cash payment from a forfaiting bank. In exchange for the payment, the forfaiting bank takes over the exporter's debt instruments and thereafter assumes the full risk of payment by the importer. Underlying a forfaiting transaction is a contract for the supply of goods and/or services whereby the supplier/exporter grants to the buyer/importer credit terms of payment. Documentation for forfaiting transactions is usually in the form of promissory notes, bills of exchange, and book receivables or deferred payments under a letter of credit. Some of the advantages of forfaiting to the exporter are conversion of a credit transaction into a cash transaction, elimination of all political and credit risks, simple documentation, improvement of liquidity, and elimination of exchange risks. For the importer, forfaiting provides the flexibility to pay for his goods on deferred terms of credit and at a fixed interest cost. A typical forfaiting transaction procedure is illustrated in the chapter.