Which of the following facts are true in the context of forfaiting? 1. Forfaiting enables exporters to receive immediate cash by selling their medium and long-term receivables – the amount an importer owes the exporterat a discount through an intermediary. 2. Banks never function as forfaiters. 3. Forfaiting protects against credit risk, transfer risk, and the risks posed by foreign exchange rate or interest rate changes.

The correct answer is C. 1 and 3.

Forfaiting is a type of export finance that enables exporters to receive immediate cash by selling their medium and long-term receivables (the amount an importer owes the exporter) at a discount through an intermediary. The intermediary, known as a forfaiter, assumes all credit risk, transfer risk, and the risks posed by foreign exchange rate or interest rate changes.

Banks can function as forfaiters, but they are not the only ones who can do so. Other financial institutions, such as export credit agencies, can also act as forfaiters.

Option 1 is true because forfaiting allows exporters to receive immediate cash by selling their receivables at a discount. Option 2 is false because banks can function as forfaiters. Option 3 is true because forfaiting protects against credit risk, transfer risk, and the risks posed by foreign exchange rate or interest rate changes.