EXIM Increases U.S. Exporter Access to Capital and Supply Chain Financing During COVID-19 by Raising Lender Guarantee Coverage Option to 95 Percent
WASHINGTON - As part of its continuing efforts to support relief measures for U.S. exporters affected by the COVID-19 pandemic, the Export-Import Bank of the United States (EXIM) raised its Supply Chain Finance Program (SCF) and Working Capital Guarantee Program (WCGP) guarantee coverage option to 95 percent, up from the standard 90 percent guarantee. This increase is effective through April 30, 2021.
Lenders who elect the 95 percent coverage will be charged a guarantee fee of at least 2.06 percent with a risk premium added to non-investment grade credit for EXIM’s SCF program, and lenders who elect the 95 percent coverage will be charged a guarantee fee of at least 2.13 percent for the agency’s WCGP program. Guarantees under the 95 percent programs are not to exceed one year from the effective date of the financing. The guarantee fee for SCF will be charged on a monthly basis in arrears for the prior month's guaranteed receivables, and the guarantee fee for WCGP will be due upfront.
By increasing the SCF and WCGP guarantee coverage option to 95 percent, EXIM will make the programs more widely available to U.S. suppliers and exporters and incentivize financial institutions to make more supply chain financing available to U.S. exporters by reducing their credit risk.
“Over the past several weeks, EXIM has done extensive outreach to diverse stakeholders, including financial institutions, to ensure we are taking the necessary steps to support America’s businesses and workers and the U.S. economy during this challenging time,” said EXIM President and Chairman Kimberly A. Reed. “Today’s announcement underscores our commitment to providing U.S. exporters access to much-needed capital and supply chain financing."
“We commend U.S. EXIM Bank for facilitating a timely response to the industry’s request during this crisis,” said Bankers Association for Finance and Trade President and Chief Executive Officer Tod R. Burwell. “This is a significant step forward enabling banks to increase support for exporting companies during a challenging time.”
More information on EXIM’s COVID-19 response can be found here, which includes fact sheets on the Supply Chain Financing Guarantee Program and Working Capital Guarantee Program.
EXIM is an independent federal agency that promotes and supports American jobs by providing competitive and necessary export credit to support sales of U.S. goods and services to international buyers. A robust EXIM can level the global playing field for U.S. exporters when they compete against foreign companies that receive support from their governments. EXIM also contributes to U.S. economic growth by helping to create and sustain hundreds of thousands of jobs in exporting businesses and their supply chains across the United States. In recent years, approximately 90 percent of the total number of the agency’s authorizations has directly supported small businesses. Since 1992, EXIM has generated more than $9 billion for the U.S. Treasury for repayment of U.S. debt.
For more information about EXIM, please visit www.exim.gov.