UKEF partners with five big banks in trade finance drive

UK government’s export credit agency seals multi-bank partnership to pipe trade finance not only to large exporters, but also to SMEs

A bold new funding avenue has opened up for British firms with the announcement that UK Export Finance (UKEF) will harness the power of five major banks to channel export credit to large exporters – and their supply chain SMEs.

Under the arrangement, UKEF – part of the Department for International Trade (DIT) – is partnering with Barclays, HSBC, Lloyds, NatWest/RBS and Santander to “significantly increase” the number of businesses able to access government-backed trade finance.

The partnership will enable banks to provide export-related trade finance (for example, working capital loans and bonds required by overseas buyers) to support their SME customers directly – underwritten by UKEF guarantees, should they be required.

In parallel, UKEF will make trade finance available to suppliers whose goods directly support the activities of UK exporters.

That measure stands as a major enhancement of the organisation’s offer.

As a result, thousands of companies in manufacturers’ and service providers’ supply chains will be able to access contract bonds and working capital loans backed by the government’s guarantee.

UKEF will deliver its support to the partner banks through a new, secure digital platform to ensure the quickest response times and most efficient customer experiences.

In a statement, international trade secretary Dr Liam Fox said: “As an international economic department, this new partnership shows the DIT’s commitment to help small businesses seize the global demand for British exports.

“Providing easily accessible finance – backed by UKEF’s guarantee – will lift a common barrier to exporting.”

Fox added: “Providing that finance to suppliers as well as exporters means spreading the benefits of global trade, supporting more jobs and growth for companies large and small.”

Jeff Longhurst – head of commercial at specialist trade body UK Finance – said: “The industry is committed to making it easier for UK exporters to access finance and [we have] worked closely with lenders and UKEF to make this process simpler.

“With nearly 70% of international SMEs planning to grow in the next 12 months, [this] announcement is a boost for both SMEs and the wider economy.”

Santander corporate and commercial managing director Mike Ellwood noted: “SMEs make up the majority of British business – yet four in five of them do not export.

“We are fully supportive of the objectives of UKEF – specifically, the delegation and digital projects that are aimed at making it easier for SMEs to access finance and making that process more efficient.”

Since the launch of UKEF’s trade finance products in 2011, almost 300 companies have benefited from around £500m in support for several billion pounds’ worth of overseas contracts.

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