Export-Import Bank

Definition:

An independent bank established by Congress that finances or insures foreign purchases of U.S. goods for customers unable or unwilling to accept credit risk.

If exporting is part of your business game plan, the Export-Import Bank of the United States (Ex-Im Bank) can be your biggest ally. The Ex-Im Bank is committed to supporting small exporters and provides many financing tools targeted to small businesses, such as working capital guarantees and export credit insurance. It also guarantees repayment of loans or makes loans to foreign purchasers of U.S. goods and services and offers U.S.exporters credit insurance to protect against nonpayment by foreign buyers. Since 1934, the Ex-Im Bank has helped finance overseas sales of more than $300 billion in U.S. goods and services.

With a working capital guarantee and credit insurance, small businesses can increase sales by entering new markets, expanding their borrowing base and offering buyers financing while carrying less risk. Often, small exporters don’t have adequate cash flow or can’t get a loan to fulfill an export sales order. The Ex-ImBank’s working capital guarantee assumes 90% of the lender’s risk, so exporters can access the necessary funds to purchase raw materials or supplies to fulfill an export order.

The export credit insurance protects an exporter from buyer payment default and also allows exporters to extend credit to their international buyers.

To be eligible for the Ex-Im Bank’s programs, U.S. exporters must simply meet the SBA’s definition of a small business and have export credit sales of less than $5 million. In addition, your product or service must have at least 50% U.S. content. The bank will finance the export of all types of goods or services except for most military-related products.

Business owners can contact the Ex-Im Bank directly at (800)565-3946 or through any commercial lender that works with the agency (see the Lender Locator at www.exim.gov). Based in Washington, DC, the Ex-Im Bank also has regional offices in Chicago, Houston, Miami, New York City, Long Beach and San Jose, California.

Related Content

Product Development

The overall process of strategy, organization, concept generation, product and marketing plan creation and evaluation, and commercialization of a new product

Exit Interview

The formal conversation that takes place between an employee and an HR or other manager to determine the reason(s) the employee is leaving

Primary Market Research

Iinformation that comes directly from the source--that is, potential customers. You can compile this information yourself or hire someone else to gather it for you via surveys, focus groups and other methods.

Credit Policy

Guidelines that spell out how to decide which customers are sold on open account, the exact payment terms, the limits set on outstanding balances and how to deal with delinquent accounts

Mergers

The combination of one or more corporations, LLCs, or other business entities into a single business entity; the joining of two or more companies to achieve greater efficiencies of scale and productivity

Subchapter S Corporation

A special form of corporation that allows the protection of limited liability but direct flow-through of profits and losses