Domestic trade involves the exchange of goods and services within a country’s borders, while cross-border trade refers to international commerce between different nations. From a finance perspective, domestic trade is influenced by national policies, taxation, and consumer demand, whereas cross-border trade adds complexities such as foreign exchange risk, tariffs, customs regulations, and geopolitical factors. Financing tools like trade credit, letters of credit, and export financing are critical to supporting both forms of trade, ensuring smooth transactions and mitigating risks.