Small Businesses across the Country Benefit from Streamlined Application for Short-Term Export Credit Insurance
FOR IMMEDIATE RELEASE March 11, 2012
Adrian Gianforti (202-565-3200)
WASHINGTON, D.C. --- When Martin Weinberg, President of Xamax Industries of Seymour, Connecticut, was encouraged by his accounting firm to look to the Export-Import Bank of the United States (Ex-Im Bank) for export financing, he was skeptical - “We wanted to go a month or two to see if Ex-Im Bank was for real,” stated Weinberg. “Now I know that Ex-Im Bank products are a no-brainer. What Ex-Im Bank charges for insurance and what the policy actually meant for my company, it wasn't a hard sell for me.”
Xamax Industries is the 200th small business to be approved for an Ex-Im Bank Express Insurance policy. The company is a manufacturer of raw materials including rolled goods such as paper, plastic, and nonwoven fabrics. The materials are sold to manufacturers abroad where the final product is assembled. According to Weinberg, Xamax will expand its workforce as business grows overseas.
After attending a Global Access for Small Business forum in New Haven, Conn., Weinberg was convinced. He learned that with Ex-Im Bank insurance, his company could increase foreign sales overseas without elevating the risk. The $1 million policy was brokered by Export Risk Management of Salisbury, Conn.
With export markets worldwide, Xamax is now willing to pursue additional buyers. “We can extend better terms to our customers,” commented Weinberg. “For example, we now have a positive balance in China - in other words, we sell more in China than we purchase, which is basically unheard of.”
“Our efforts to encourage more small businesses to export are paying off through the use of Bank products like Express Insurance,” said Fred P. Hochberg, chairman and president of Ex-Im Bank. “With the exporting success of companies like Xamax Industries, I am optimistic that our products are effective solutions for small business exporters seeking financing for themselves and their foreign buyers.” Express insurance was launched in April, 2011 and has soared in the past year as a reliable tool for small business. Express insurance streamlines the process of acquiring short-term insurance. Small businesses are able expand into new foreign markets, add new buyers, and transfer foreign buyer credit decision making to Ex-Im Bank at an economical cost. The online application provides a policy quote and two foreign buyer credit decisions up to $300,000 within five workdays. More information on how to apply for the policy is available on the Ex-Im Bank website.
In fiscal year 2011, small business financing rose over 70 percent from $3.3 billion in FY 2008 to $6 billion in FY 2011. As part of its efforts to increase this portfolio, Ex-Im Bank's Global Access for Small Business initiative has held more than 30 forums across the country since its launch last year.
Recently, while in Seattle with Chairman Hochberg, President Obama announced two new Ex-Im Bank products, Global Credit Express (GCE) and the Supply-Chain Finance Guarantee program for Boeing small business suppliers. Through GCE, small business exporters may be eligible for a revolving line of credit, up to $500,000 for 6 to 12 months. The product is specially designed to finance the business of exporting rather than specific export transactions. During its pilot phase, GCE will be offered by a select number of lenders nationwide.
The Supply-Chain Finance Guarantee program provides competitively priced working capital financing to suppliers of goods or services to U.S. exporters. The program enables suppliers to receive early payment of their accounts receivable that are due from participating exporters in exchange for a small discount fee that is paid to the lender. Ex-Im Bank provides a 90 percent guarantee of the invoices while the lender bears 10 percent of the risk.
Under the Ex-Im program, approved lenders must have an existing supply-chain finance program. Ex-Im Bank has set a target that at least 50 percent of the credit be extended to suppliers that meet the definition of a small business as defined by the U.S. Small Business Administration by the end of the 12-month term. The end products must be for export and must meet Ex-Im Bank's requirements for U.S. content.
Small business exporters interested in additional information on GCE and other Ex-Im Bank products may contact the Bank by calling toll-free to 1-800-565-EXIM (3946) and selecting option 2.
ABOUT EX-IM BANK
Ex-Im Bank is an independent federal agency that helps create and maintain U.S. jobs by filling gaps in private export financing at no cost to American taxpayers. In the past five years, Ex-Im Bank has earned for U.S. taxpayers $1.9 billion above the cost of operations. The Bank provides a variety of financing mechanisms, including working capital guarantees, export-credit insurance and financing to help foreign buyers purchase U.S. goods and services.
Ex-Im Bank approved $32.7 billion in total authorizations in FY 2011 -- an all-time Ex-Im record. This total includes more than $6 billion directly supporting small-business export sales -- also an Ex-Im record. Ex-Im Bank's total authorizations are supporting an estimated $41 billion in U.S. export sales and approximately 290,000 American jobs in communities across the country. Persons interested in applying for positions in Ex-Im Bank regional offices can go the careers section at Exim.gov. For more information, visit www.exim.gov.