UK Export Finance: Our Products, Services and Solutions
- Daniel McPartlan
- Dec 3, 2024
- 8 min read
Through my last two articles [Issue 8] [Issue 9] I’ve tried to outline a couple of important messages. Firstly, that we are actively supporting businesses on a daily basis but also, secondly, that we genuinely support businesses of every size.
The way in which we are able to achieve both of these points is by having a suite of products, services and solutions that provide a wide range of options to fit the needs of as many businesses as possible.
It’s fantastic that we are able to offer such varying solutions however, if there was to be a downside, it would be that it can make it that bit harder to explain each of our services to business.
As such, I’ve taken the opportunity over the next few pages to provide you with a snapshot of each of our services. Through the brief outlines, eligibility criteria and (in some cases) short video descriptions, I hope you can easily identify a solution which will be of benefit to you.
Remember, if you want to talk through any of these solutions, my colleagues and I are always available to help discuss how UKEF can benefit your business
Currently my role sees me sit as the Export Finance Manager for North Yorkshire, Humberside, Teesside and Northern Ireland* (*cover). However, wherever you are based in the UK, one of my colleagues will be available to provide you with a supportive and helping hand.
If you would like to get in touch with a member of the team then easiest way of doing so would be to complete our “Contact Us” form on our website.
Also, follow our pages on social media to keep up to date with the latest news and to witness some of the brilliant support we continue to offer across the country:
Get insurance against the risk of not being paid for an export contract, or of not being able to recover the costs of performing the contract.
Key Points:
Cover for up to 95% of potential losses
Insurance available directly from UKEF or via a credit insurance broker
No requirements or caps on the amount that can be covered
Can provide cover for events such as; buyer insolvency, buyer’s failure to make payment, events outside the UK which prevent payment being made in foreign currencies or hostilities/ civil disturbances.
Eligibility:
You must meet the following:
You’re exporting from the UK and have an established base here
At least 20% of the value of your export comes from UK goods or services
Your buyer is based overseas in a country that UKEF covers
We may also ask if you’ve tried to get credit insurance through the private market.
Provides cover for your overseas investments against losses due to political events.
Key Points:
Cover for up to 90% of potential losses
Cover in markets that the private market is unable to support
Maintain the same premium and terms for up to 15 years
Cover against damage directly caused by war, civil war, revolution, insurrection, sabotage or terrorism in the host state. Also covers expropriation attributable to the host government and restrictions on remittances.
Insurance against demands for payment under a bond or a counter-guarantee to an overseas buyer that is unfair or caused by certain political events.
Key Points:
Cover for up to 100% of the contract’s a value
Protects against losses suffered because of unfair calls on the bond
Protects against fair calls on the bond caused by certain political events
Can protect you from demands for payment in specific situations, including some political events. We can consider cover for all types of bonds connected to export contracts.
Eligibility:
You must meet the following:
The exporter must be carrying on business in the UK
The buyer must be in a country outside the UK
The bond must not be given for contracts that are aid-funded by the UK government.
Working Capital Solutions
UK Export Finance (UKEF) offer a number of solutions which aim to help businesses to increase their cashflow. Whether this is to help you fulfil export orders, take on more international contracts or simply increase turnover, we have the right solution for you!
Access trade finance facilities up to £25million, without the need of an export contract.
Key Points:
Provides a guarantee for up to 80% of the facility
No need for the facility to be tied to a specific export contract
Can support cash facilities or bonding and letter of credit lines
Aims to help businesses increase their export volumes by providing additional cash
Maximum repayment terms must be no longer than 5 years and for a sum of no more than £25 million.
Eligibility:
You must be able to show that either:
In any one of the last three financial years, at least 20% of your annual turnover has been made up of export sales
In each of the last three financial years, at least 5% of your annual turnover has been made up of export sales.
Provides a partial guarantee to your bank in support of contract bonds.
Key Points:
Provides a guarantee for up to 80% of the bond’s value
This can help to increase your bank’s appetite to provide finance
Less cash tied up as collateral to secure your bond
There is no maximum value for each bond and no minimum or maximum term.
Eligibility:
The transaction must satisfy UKEF’s eligibility criteria which includes:
That you are carrying out business in the UK, Isle of Man or Channel Islands
That you have entered, or intend to enter, into a contract for the supply of goods/ services with an organisation that carries out business outside the UK.
Support companies in your supply chain by allowing them to discount their invoices and get paid earlier.
Key Points:
Provides a guarantee of up to 80% of lender’s risk
Convert invoices to cash which helps your suppliers to get paid earlier
Offer greater certainty to your suppliers
UKEF’s guarantee means that suppliers are paid in advance and at face value, less a discounting fee
As a business, you repay your bank at the end of the agreed credit period.
Eligibility:
To be eligible you must be able to show either:
In any one of the last three financial years, at least 20% of your annual turnover has been made up of export sales
In each of the last three financial years, at least 5% of your annual turnover has been made up of export sales.
Provides a partial guarantee to your bank in support of working capital facilities which are linked to specific export contracts.
Key Points:
Provides a guarantee for up to 80% of the risk
Access working capital that allows you take on larger, higher value contracts
Helps to increase your lender’s appetite to provide finance
Does not include any minimum or maximum value restrictions.
Eligibility:
The transaction must satisfy UKEF’s eligibility criteria which includes:
That you are carrying out business in the UK, Isle of Man or Channel Islands
That you have entered, or intend to enter, into a contract for the supply of goods/ services with an organisation that carries out business outside the UK.
Access finance for high value facilities, without the need of an export contract.
Key Points:
Provides a guarantee for up to 80% of your lenders risk
Extra financing capabilities to help you invest in activities to increase exports
The ability to bid for multiple contracts with a secure source of capital
No requirement for history of exporting and can support facilities of over £25 million.
Eligibility:
You must be able to show that either:
UK export sales represent at least 20% of your UK annual sales turnover in the last financial year, or
UK export sales represent at least 20% of your UK annual sales turnover on average over the last three financial years, or
You have a business plan demonstrating how UKEF support would facilitate significant development in the exporting goods or services from thttps://www.ukexportfinance.gov.uk/products-and-services/buyer-credit-facility/he UK within 5 years
Buyer Finance Solutions
Our financing solutions aim to help international buyers purchase goods and services.
Buyer Credit Facility
Provides a guarantee to a bank making a loan to an overseas buyer so that they can purchase UK sourced goods or services.
Key Points:
Provides a guarantee for up to 85% of the contract value
At least 20% of the contract’s content must come from the UK in order to benefit from this facility
As the UK business, you will be paid as soon as the goods have been shipped or the services have been performed
Your buyer can repay the loan over a number of years and can borrow at fixed or floating interest rates
We can consider supporting corporate, sovereign and public buyers.
Covers a loan to an overseas buyer to finance the purchase of capital goods, services or intangibles from a UK supplier in the range of £1m - £30m.
Key Points:
Provides a guarantee for up to 85% of the contract value
As the UK business, you will be paid as soon as the goods have been shipped or the services are performed
Your buyer or borrower can repay the loan over a number of years (usually 2-5 years)
At least 20% of the contract value must be UK contact and the supplier must be carrying on business in the UK
Typically relevant for contracts valued between £1m and £30m.
A guarantee to cover payments due under bills of exchange or promissory notes purchased from you by a financial institution.
Key Points:
Provides a guarantee for up to 85% of the contract value
As the UK business, you will be paid as soon as the goods have been shipped or the services are performed
Your buyer or borrower benefits from extended payment terms
Your bank purchases the bill or notes from you at a discount, resulting in your buyer making payment under the bill or note to the bank at a future date. We provide a guarantee to the bank that your buyer will pay the amount due, allowing your to be paid when the goods are shipped or service supplied.
Provides a guarantee to a bank making a loan to an international buyer to finance the purchase of design, engineering or technical services from a UK supplier for early project work.
Key Points:
We can provide a guarantee for up to 85% of the contract value
As the UK business, you get paid as soon as the service is performed
Your international buyer has up to 2 years to pay for the services
Eligibility:
The supplier of the early project services must be carrying on business in the UK
The financing must relate to services for the project and cannot involve physical project work
The loan cannot be longer than 2 years.
Provides a direct loan to an overseas buyer to support the purchase of goods, services or intangibles from the UK. Loans can be made for up to £200 million and for a period of 2 years or longer.
Key Points:
The loans we provide for each transaction can be made in up to 8 currencies, with a value limit of £200 million
As the UK business, you are paid as soon as the goods have been shipped or the service has been performed
Your buyer can repay the loan over a number of years and can borrow at fixed or floating interest rates
For projects in excess of £50m, the Direct Lending Facility can be provided alongside commercial finance backed by our Buyer Credit Facility
Eligibility:
At least 20% of the contract value must be UK content and the exporter must be carrying on business in the UK
The export contract should have a value of at least £5m of equivalent in foreign currency.
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