Export Finance and Insurance

Export finance, insurance, payment terms, and pricing are all critical to successful exporting.

Export financing offers a way to release working capital from overseas transactions that might otherwise remain tied up in invoices for some time. Export credit insurance (ECI) protects an exporter against the risk of non-payment by a foreign buyer. This significantly reduces international payment risks by giving conditional assurance that payment will be made if the foreign buyer defaults.

  • U.S. Small Business Administration: The SBA has three loan programs to help U.S. exporters. Because most banks do not advance cash against foreign receivables, the SBA export loan guarantees were created to help to fill this funding gap.
  • Exim Bank: The Export-Import Bank of the United States is the official export credit agency of the United States. When private sector lenders are unable or unwilling to provide financing, EXIM fills in the gap for American businesses by equipping them with the financing tools necessary to compete for global sales.  Toward that end, it offers both export financing and export credit insurance. Click here to download the EXIM Bank Agency Overview Brochure. Private insurance companies also offer export credit insurance. For information on these click here.

  • USDA Trade Finance Programs – The The USDA Foreign Agricultural Service (FAS) provides trade finance solutions for exporters of U.S. agricultural products to developing markets. International sales into these markets can pose financing challenges, as U.S. banks may be reluctant to assume the associated credit risk.
  • International payment terms are a critical part of any export transaction. They can determine if you are successful in making the sale, if you make a profit, and the associated financial risk.
  • Costing and pricing must be carefully managed. Establishing the right pricing and procedures for quoting on your products or services are both critical to developing a successful export business.
  • Risk managemant is a backdrop to all of the above, and must be consciously measured and controlled with selling overseas.
  • Due dilligence reports are an important tool when considering doing business with overseas firms. Companies with excellent credit may be extended more lenient payment terms.