Financial assistance for exporters: SBA and Ex-Im bank programs.(Selected Topic)

Securing export financing is difficult for most businesses but particularly for small companies. Several federal financial programs exist for U.S. exporters in support of their foreign sales. Programs are often specially designed for small-and medium-sized firms. Assistance includes straightforward loans, working capital guarantees and even risk insurance.

The Export-Import Bank of the United States (Ex-Im Bank) and the U.S. Small Business Administration (SBA) offer financial assistance to U.S. exporters. However, there are several other federal programs for exporters. For instance, the U.S. Department of Agriculture supports U.S. agricultural sales overseas through a variety of programs and services. Also, the Overseas Private Investment Corporation has a loan program for U.S. firms that invest in developing countries.

Where can an exporter find capital to fulfill foreign trade obligations?

The Ex-Im Bank has an Export Working Capital Guarantee (EWCG) program that provides U.S. exporters with working capital to fulfill their foreign trade transactions. The Ex-Im Bank also has a loan guarantee program that enables lenders to make loans to foreign buyers, with the loan proceeds used to pay for specified products from U.S. firms.

How does an exporter protect foreign accounts receivable from governmental and commercial risk?

An exporter can protect his foreign accounts through the Ex-Im Bank's foreign credit insurance program. This allows U.S. firms to insure their foreign accounts to mitigate foreign financial risk. Firms using this program are able to offer overseas buyers credit terms rather than requiring up-front payment, thereby allowing sales to be more flexible.

How does the SBA help exporters?