The news that UK Export Finance will increase the risk it underwrites from 50% to 80% across its Bond Support and Export Working Capital schemes, will enable banks to assist more exporters seeking to maximise opportunities in international trade.
At a breakfast event at the Institute of Directors, representatives from a wide range of banking organisations reacted positively to a raft of developments outlined by David Godfrey, Chief Executive of UK Export Finance, which supports small and medium-sized enterprises (SMEs) and mid-market exporters by sharing financial risks that the private sector is unable to shoulder alone.
Since 2011, UK Export Finance, the UK’s credit export department, has broadened the trade horizons of over 120 UK-based businesses. Backing almost £1 billion of export contracts to over 65 markets and with a pipeline of a further 300 transactions.
In addition it has given financial advice to over 250 exporters through its 12-strong team of regional export finance advisors who signpost exporters and businesses to banks, credit insurers, brokers, trade support bodies and routes to government support.
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A recent National Audit Office report entitled Improving access to finance for small and medium-sized enterprises forecasts a potential £22 billion funding gap between the level of finance available to SMEs and the amount they need, Mr Godfrey said:
“The role of the export credit department is even more critical in today’s market. Forging and sustaining powerful partnerships and collaborations between ourselves and banking organisations will be instrumental in achieving the Government’s goal to double exports to £1 trillion by 2020. Exports are vital to the UK’s future growth and we are committed to playing our part in plugging the finance gap to accelerate opportunities for those with the potential to take their business further.”
Peter McIntyre, HSBC Head of UK Trade, reinforced how collaboration with UKEF is vital as the UK looks to exporters to lead the financial recovery:
“We will continue to harness UK Export Finance’s schemes as part of our ongoing support for innovative and forward looking businesses who are looking to take advantage of international opportunities”
Barrie Kilfeather, Santander Regional Director International commented: “We welcome the news that UK Export Finance is increasing the risk it underwrites. We will look to work with the department, through its Bond Support and Export Working Capital schemes, to help even more customers gain the facilities they need to secure and deliver bigger and more profitable international contracts, in turn helping them to drive local job creation and UK economic growth.
“It’s important that Government and the banks work together to support small and medium sized businesses to expand into new international territories and high growth markets. These partnerships are instrumental in accelerating the UK’s growth in exporting and international trade.”