The UK government has introduced a new scheme to export finance for small and medium UK exporters for the first time so that freight forwarding and logistic providers can help provide a boost to the UK economy following Brexit.
The department for International Trade admitted that under the scheme, UK Export Finance would benefit, making much more business for both exporters and supply chains across the banks offering financial support.
Smaller companies that support big UK exporters will be able to secure government-backed financing to deliver products and services and benefit from their clients’ international business, the department commented.
Secretary of State for the Department for International Trade Liam Fox said UKEF would partner with five of the UK’s biggest banks “to deliver government-backed financial support to exporters more quickly and efficiently”.
Fox said: “Providing easily accessible finance, backed by UKEF’s guarantee, will lift a common barrier to exporting. Providing that finance to suppliers as well as exporter’s means spreading the benefits of global trade, supporting more jobs and growth for companies large and small.”
Head of commercial at banking trade association UK Finance, Jeff Longhurst added: “The industry is committed to making it easier for UK exporters to access finance, and UK Finance has worked closely with lenders and UKEF to make this process simpler. With nearly 70% of international SMEs planning to grow in the next 12 months, today’s announcement is a boost for both SMEs and the wider economy, helping support businesses across the country.
“Through this new model, banks will be able to provide export-related trade finance, for example working capital loans and bonds required by overseas buyers, to support their SME customers directly, and with UKEF’s guarantee in place should it be needed. At the same time, UKEF will make trade finance support directly available to direct suppliers supporting UK exporters, in a major enhancement to its existing offer. This will allow thousands of companies in manufacturers’ and service providers’ supply chains to access contract bonds and working capital loans with the government’s guarantee.”
A new and secure digital platform has been encouraged in aid of ensuring the quickest response times and most efficient customer experience.
John Mahon, head of Barclays Corporate Banking, said: “Delegated authority will make accessing UKEF guarantees simpler for many businesses and will help companies we work with grow more quickly. Both exporters and companies involved in international trade through supply chains will benefit, and we look forward to further collaborating with UKEF and our colleagues across the industry to find more new and innovative ways to help UK businesses take full advantage of export opportunities.”