07 April 2020
UK Export Finance (UKEF) have announced that they are offering UK businesses extended export insurance to protect against non-payment when selling internationally during the Covid-19 pandemic.
The department, who already offer the Export Insurance Policy (EXIP) to UK businesses, have extended their cover to all major business jurisdictions in light of the impact of Coronavirus on overseas trade.
This government-backed insurance is available immediately and will cover transactions with the EU, Australia, Canada, Iceland, Japan, New Zealand, Norway, Switzerland and the US. The scheme provides cover for up to 95% of the value of an export contract for non-payment from any customer in one of the above locations who either becomes insolvent or for whom local government restrictions prevent them from completing the contract.
Who is eligible?
In order to be able to take out the insurance policy, you will need to meet the following qualifying criteria:
- you must be carrying on business in the UK
- your customer must be carrying on business overseas
- you will need to demonstrate that you are unable to obtain credit insurance from the commercial market.
N.B. The insurance may not apply to any transactions with customers based in countries with sanctions imposed upon them.
More financial support for exporters
In addition to the extended insurance scheme and the various support packages already announced by the Government for UK businesses during this crisis (find more information in the Covid-19 section of our website), UKEF also have a series of support packages for UK exporters, including:
- guaranteeing bank loans to ease cash flow through their Export Working Capital Scheme if your business is facing disruption due to late payments from overseas businesses
- providing finance for overseas buyers through their Direct Lending Facility scheme, so they can continue to buy your goods and services
- providing access to more than £4 billion of capacity to support UK firms exporting to China, and significant capacity across other markets also affected by Coronavirus (COVID-19) to help cover related risks.
We believe these measures will provide some positive reassurance for exporting SMEs, who accounted for more than 95% of the 230,000 UK based exporting businesses last year.
How do I apply for the EXIP scheme?
To apply for the UKEF export insurance policy you can either contact UKEF directly by email at firstname.lastname@example.org or you can contact one of more than 40 insurance brokers approved by UKEF to provide the EXIP scheme. If you would like help with this process, however, and would like more information on how to continue trading overseas over the coming months, please speak to your usual UHY adviser, or contact me directly.