FOR IMMEDIATE RELEASE September 19, 1999
Nancy Publicover (202) 565-3200
The Export-Import Bank of the United States (Ex-Im Bank) is launching a pilot program to assist small businesses that have not been able to obtain financing for their exports in the traditional market. Under the new working capital guarantee component of Ex-Im Bank's Underserved Markets Program, Ex-Im Bank offers eligible exporters coverage for 100 percent of their export working capital financing needs, compared to 90 percent for exporters under Ex-Im Bank's regular working capital guarantee program. The loans will be purchased by the Private Export Funding Corporation (PEFCO) through its Working Capital Facility. The Underserved Markets Program is available to small exporters that are minority owned, women-owned, located in an economically depressed or rural area, or specialize in environmentally-beneficial goods and services.
Ex-Im Bank's mission is to serve U.S. exporters, whether large or small, said Vice Chair and Chief Operating Officer Jackie M. Clegg. By providing increased guarantees on export working capital loans, Ex-Im Bank is helping U.S. companies that are new to exporting gain access to critical private sector financing and establish business relationships with their local lenders. Clegg is in Somerset, Kentucky today to launch the program at the Center for Rural Development's New Tools for New Markets conference.
In contrast to Ex-Im Bank's traditional working capital guarantee program, borrowers under the Underserved Markets Program are not required to have a preliminary commitment from Ex-Im Bank, nor do they have to have been declined by two lenders. Applications may be submitted directly to Ex-Im Bank, regardless of dollar amount. The borrower must be new to Ex-Im Bank, must have total annual sales under $10 million, have fewer than 100 employees, and must qualify as a small business under Small Business Administration guidelines. The Underserved Markets Program sets a maximum guarantee of $2 million per loan.
Ex-Im Bank's Underserved Markets Program was developed in response to a 1997 congressional mandate to serve more small and rural companies that have not previously exported or used the Bank's services. In addition to the newly-available terms and coverage for working capital loans, the Underserved Markets Program includes expanded regional outreach and targeted marketing of Ex-Im Bank's services to eligible exporters and lenders. Small business exporters also benefit from a new Community level of delegated authority which brings more community banks and other small lenders into Ex-Im Bank's Working Capital Guarantee Program.
The Ex-Im Bank is an independent U.S. government agency that assists in financing the export of U.S. goods and services to industrializing and developing markets all over the world, by providing loans, guarantees, and export credit insurance. Nationally, Ex-Im Bank supported nearly $13 billion in U.S. exports in the 1998 fiscal year.