Working Capital

Bank Acceptance Draft (BAD) Discount

Build your business with improved turnaround time and fast access to funds

Speed up your turnover and improve your cash flow by selling your Bank Acceptance Draft (BAD). It is widely accepted in China and enables you to cash your drafts in with low financing costs for immediate access to funds. Choose a repayment tenure of up to six months or one year, depending on whether the draft is drawn on paper or issued electronically. You can also leverage our relationships with more than 20 banks that accept BADs to gain access to cash.

As required by PBOC, starting from 1 January 2017, all commercial drafts worth RMB 3 million or more must be handled through electronic system (ECDS); from the beginning of 2018, all commercial drafts worth RMB 1 million or more should be in principle issued electronically. For more details, please click here.

Why choose DBS Bank Acceptance Draft Discount?

  • Improve your cash flow and speed up turnover of your assets
  • Leverage DBS’ reputation and relationship with more than 20 banks in China, with flexible arrangements such as BPI (Buyer-Paid-Interest), PAD (Principal-Agent-Discounting) and Repo (BAD Repurchase) for your convenience
  • Choose to have your drafts drawn on paper or issued electronically. The tenure is up to six months or one year respectively
  • Access flexible interest rates with BAD discounting
  • Resolve issues with your suppliers with advice from our consultancy service


How is the BAD discounting period calculated?

The discounting period is calculated based on the number of days from the date of discounting to the BAD maturity date.

Who pays the interest under BAD Discounting?
Interest can be paid by either the buyer or supplier under BAD discounting, depending on the agreement.
What is the maximum BAD tenure?

You can choose from tenures of up to 180 days for drafts drawn on paper, and up to of a year for drafts issued electronically through the People’s Bank of China (PBOC) Electronic Commercial Draft System. This is in accordance to the guidelines set by PBOC.

What are the major documents provided under BAD Discounting?

The following documents are provided under BAD discounting:

  • BAD discount agreement
  • Application Form
  • Original sales contract or purchase order
  • Original VAT certificate
How is the BAD Discounting rate calculated?

The BAD Discounting rate is determined by the cost of funding at the time of discounting plus a risk premium depending on the accepting bank’s credit rating, which is benchmarked against prevailing market rates.

Is BAD Discounting subject to a credit limit?

No credit limit applies if you are applying for without-recourse BAD discounting, however facilities with recourse are subject to a credit limit.


How do I apply?

Simply call us at 400 820 8988 (or +86 400 820 8988 if you're overseas) or visit any of our Branches. You may also email us and our Relationship Manager will contact you as soon as possible.



The information provided in this website is for general information only and nothing contained in this website constitutes an invitation, offer or solicitation with respect to the entry into transactions mentioned in this website or subscription, purchase or sale of any products, services, securities or other financial instruments mentioned in this website or the taking of any position or the adoption of trading strategy in respect of any asset class (eg. currency, interest rate, commodity, equity etc). The information provided in this website is not provided with regard to the specific investment objectives, financial situation and the particular needs of any particular person who accesses this website.


The information provided on this website is subject to change without notice, its accuracy is not guaranteed, and it may be incomplete or condensed. Accordingly, no representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of the information in this website. We are not acting as your advisor or agent when providing the information in this website. The information in this website does not purport to identify the risks (direct or indirect) or other material considerations which may be associated with you entering into a particular transaction, subscribing for a particular service or purchasing or selling a particular security or financial instrument. Prior to entering into any proposed transaction or entering into any subscription, purchase or sale of any security or financial instrument, you should determine (after consultation with your own advisors if you deem fit), without reliance upon us or our affiliates, the economic risks and merits, as well as the legal, tax, accounting or other material characterisations and consequences of the transaction, subscription, purchase or sale, as the case may be, and that you are able to assume these risks.


We, and/or our affiliates, may hold, or trade, or act as market-maker, in any securities or other financial instruments mentioned in this website or related derivatives or may take positions or use trading strategies in respect of any asset class similar to or which differ from or be contrary to those mentioned in this website. We, and/or our affiliates conduct many businesses and activities that may relate to issuers of third party securities mentioned in this website and may provide broking, banking and other financial services to such issuers.


Anyone receiving or accessing this website must make their own assessment of the materials herein and conduct such investigations and seek such professional advice as they think fit for such purpose. The information provided on this site should not be regarded by recipients as a substitute for the exercise of their own judgment.


© DBS BANK LTD, 2013. All rights reserved. Any unauthorized use, duplication or disclosure is prohibited by law and will result in prosecution.

Best SME Financing/Cash (Highly Commended) 2015

Best SME Financing/Cash (Highly Commended) 2015

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