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WTM 2021: EXIM’s Prescription for Export Financing to Support Economic Recovery
May 24, 2021 Maureen Whelan, Business Development Specialist, Office of Small Business

As vaccinations become available worldwide and businesses begin to move forward, the Export-Import Bank of the United States (EXIM) has several “prescriptions” for helping U.S. exporters recover from this economic malaise. As outlined in the following "prescriptions," you will learn about EXIM's mission and products available to small businesses that will help your company beat the competition and win contracts outside U.S. borders.

 

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Dose 1: EXIM assists U.S.-based companies with export financing tools to support expansion into global markets.

As an independent federal government agency, EXIM’s mission is to support the maintenance and creation of U.S. jobs by facilitating exports for U.S.-based firms, especially small and medium-sized enterprises. Each year, about 90 percent of EXIM transactions are with small businesses.

Dose 2: EXIM offers low-cost export credit insurance to mitigate risk and assist companies sell their products and services internationally.

Did you know that only about 1 percent of companies export because of the fear of the unknown, especially nonpayment?

EXIM can help your team face that fear by mitigating the risk of nonpayment by foreign customers.

With EXIM’s Export Credit Insurance, your company can:

  • Protect your company’s products or services from nonpayment by insuring foreign accounts receivable against commercial and political risks
  • Offer open account credit terms to foreign buyers for 30-60 days, up to 180 days
  • Improve cash flow by borrowing against these U.S. government-backed insured receivables

Many foreign customers prefer to pay with credit terms rather than cash in advance. With EXIM’s insurance, you protect your foreign accounts receivable, enabling your company to offer open account credit terms. This feature often establishes a competitive advantage and wins contracts.

If a foreign customer does not pay your company within the agreed terms, your staff can file a claim. EXIM’s export credit insurance covers up to 95 percent of the invoice value for commercial or political risk.

Dose 3: EXIM’s Working Capital Loan Guarantee reduces risks for lenders, encouraging them to loan to U.S. exporters.. EXIM backs the exporter's debt with a 90 percent guarantee for the commercial lender.

EXIM can also help to improve liquidity for your small to medium-sized enterprise. The risks associated with international sales may prevent commercial lenders from providing the working capital needed to fulfill export orders. With a government-backed loan, pre-approved EXIM lenders are more likely to extend a working capital loan. With access to additional funds, your company is able to hire more staff or purchase more materials to build export-related inventory.

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Dose 4: Refer to the Country Limitation Schedule (CLS).

By checking the Country Limitation Schedule, you company can determine the level of support EXIM can or cannot provide for each country you want to sell to.

Dose 5: Complete a free consultation request to speak with an EXIM trade finance specialist today.

The fastest way to get help from EXIM is to complete a free consultation request to discuss your company’s exporting needs.

Whether your business needs one of these doses or all prescriptions to support its journey into world markets, EXIM’s financial specialists are prepared to provide counsel and a solution. Embracing international opportunities may be one valuable path to financial wellness and growth for your company. Embrace it!

 

 

Get a Free Export Finance Consultation Today!