UK Export Finance (UKEF) is the UK’s export credit agency and its mission is to ensure that no viable UK export fails for lack of finance or insurance. UKEF provides a range of export schemes that are available to both exporters and to businesses that directly supply goods or services to an exporter.
Through these schemes, UKEF provides the bank with a guarantee representing a portion of the outstanding debt should the borrower default on their obligations. Therefore, these schemes can be particularly helpful for a business that is experiencing difficulties securing funding due to a lack of security to offer as collateral.
The export schemes available include:
Bond support scheme
Bonds, Guarantees and Standby Letters of Credit can represent important tools for exporters and their suppliers to secure export or supply contracts.
Through the Bond Support Scheme, UKEF provides the lender with a guarantee for a portion of Bonds, Guarantees and Standby Letters of Credit issued by the bank to the exporter or to a business that supplies goods or services to the exporter. This can help the exporter or their supplier to more easily obtain the funding support that they require to win an export or supply contract.
Export working capital scheme
Exporters may require working capital facilities, both pre- and post-shipment, to fulfil specific export contracts. Similarly, a business that supplies goods or services to an exporter may also require working capital facilities to fulfil an order.
Under the Export Working Capital Scheme, UKEF provides the lender with a guarantee for a portion of working capital facilities that the lender provides to the exporter or their supplier to help fulfil a specific export or supply contract.
Important to note: Guarantees provided by UKEF to a lender are intended to assist UK exporters to access finance. They do not reduce the borrower’s liability to repay the debt in anyway. Normal recovery and enforcement procedures will be undertaken by the Bank before calling on UKEF guarantees.