Earlier this week, International Trade Secretary Liam Fox announced that small businesses can now access government-backed export finance, directly from their banks.
UK Export Finance (UKEF), the UK’s export credit agency, on Monday 16 October launched a new partnership with five major high street banks, “allowing smaller businesses to access millions of pounds in government-backed trade finance directly from their bank”. The banks involved are Barclays, HSBC, Lloyds, RBS/NatWest and Santander.
KEF, as part of the Department for International Trade, provides financial support to help UK companies sell to international customers. This financial support includes guarantees to banks to help businesses access bank finance, even where they’ve reached their credit limit or where the deal is considered too risky for the banks to take on alone.
With this new partnership for finance up to two million, SMEs can access UKEF support directly from their bank, without the need to apply separately. Provided a transaction meets UKEF’s criteria, the bank will notify UKEF through a new secure digital platform. Per the press release,
“this means that, where previously it could take weeks in addition to the banks’ own turnaround times to access this support, it will now take a matter of seconds where the transaction is eligible”.
As part of the announcement, companies that aren’t yet selling overseas but are supplying products directly to those who are, will also now qualify for UKEF support.
UKEF exists to ensure that no viable UK export should fail for want of finance or insurance from the private market. It provides finance and insurance to help exporters win, fulfil and ensure they get paid for export contracts and supports exporters with a range of products that include:
- Bond insurance policy
- Bond support scheme
- Buyer & supplier credit financing facility
- Direct lending facility
- Export insurance policy
- Export refinancing facility
- Export working capital scheme
- Letter of credit guarantee scheme
We will be liaising with the banks to find out more practical details of the implementation of this new initiative at a regional/local level, and I suspect that Andrew James will be lining up one of the banks to speak at his export focused ‘Breakfast Briefing’ in December. For now, as per the press release, “Businesses interested can find out more by speaking to their bank”.