If you’re looking to start exporting your goods or services abroad, there are a number of steps you can take to prepare. GOV.UK offers guidance on how to get your business ready to export – from the duties, rules and restrictions, to the licenses you may need.
Once you’ve got an export plan in place, you’ll need to secure finance. Export finance is the range of finance facilities that support international trade – ranging from loans, to insurance to letters of credit.
UK Export Finance is a UK government ministerial department and the nation’s export credit agency (ECA). It partners with private sector finance providers – including banks, non-bank financial institutions (NBFIs) and insurance brokers – to grow UK exports and international trade. UKEF helps exporters access working capital and manage the risk of not getting paid by offering a government guarantee.
A common hurdle faced by exporting businesses is cashflow constraints. Depending on the agreed payment terms, there can be a delay between an exporter doing the work and getting paid by their international buyer.
UK Export Finance, though its General Export Facility, can provide a partial guarantee to a UK business’s bank to help them gain access to working capital, without being tied to a specific export contract. This helps businesses cover the everyday costs linked to exporting, including paying for labour costs and building inventory to boost exports. London-based jewellery firm TLKE used the General Export Facility to continue underwriting letters of credit and protect its relationship with its supplier during the COVID-19 pandemic.
Another aspect of international trade finance is insurance. It can help protect your business against the risk of not being paid for export contracts, or of not being able to recover the costs of performing a contract because of certain events. UKEF may be able to provide cover even when the private market cannot offer insurance. The Export Insurance Policy can cover up to 95% of potential losses, helping you to export with confidence.
Finally, UKEF can also offer competitive finance to international buyers to help them procure from UK suppliers through its buyer finance offer.
UKEF can help SMEs through its network of regional Export Finance Managers based around the UK who can provide free and impartial consultations to businesses on their export finance needs. They help UK companies to check they are getting the appropriate export finance support and, if not, guide them on how to bridge any gaps.
UKEF’s finance, insurance and guarantees can help businesses of all sizes access working capital, manage risks and compete on a global scale.
Get in touch to see how they can help your business reach new markets.
