Export Enterprise Finance Guarantee

Coverage: Blackburn with Darwen, Blackpool, Burnley, Chorley, Fylde, Hyndburn, Lancaster, Pendle, Pennine Lancashire, Preston, Ribble Valley, Rossendale, South Ribble, West Lancashire, Wyre,

Finance Type: Business Expansion, Exporting,

Summary

The Export Enterprise Finance Guarantee (ExEFG) facilitates the provision of commercial export finance facilities to viable small and medium sized enterprises (SMEs) which lack the security necessary to obtain such facilities. ExEFG is a self-financing scheme through which the lender is provided with a guarantee (of 60%) for which the borrower pays a premium (3% up front fee). All decisions on the use or otherwise of ExEFG rest with the participating lenders.

There are a variety of types of loan facilities available:

• Trade Loans (including Letters of Credit, Export Collections, pre-export finance / import credit facilities, export invoice finance, investment term loans)
• Export Bonds, Guarantees & Indemnities
• Other Contingent Liabilities (including FX hedging)
• Any combination of the above via Trade Multi-Option Facility.

The purposes for which that finance may be utilised include:

• Working capital to fund the purchase of materials etc in order to manufacture goods for sale internationally
• Depositing of performance bonds and similar instruments in order to satisfy requirements of an overseas customer
• Exporting of overseas sourced good produced to the design / specification of the business, even if those goods are shipped directly to a third country and do not originate from theUKor touchUKshores
• Importing of goods for subsequent re-export following value added activity by the business in theUK
• Promotional and related activities focused on increasing exports, such as an advertising campaign outside theUK, the establishment of a representative office outside theUK, or the appointment of an overseas agent; or the setting up of a distribution network overseas

An ExEFG accredited lender may not necessarily offer certain types of facilities, or for certain purposes, if to do so would be incompatible with their normal export lending practices.

Process:

Businesses seeking export finance that believe they may fit the ExEFG eligibility criteria should approach one or more of the participating lenders. The following lenders have agreed to participate in the scheme initially:  Barclays; HSBC; Lloyds TSB & Bank of Scotland; Royal Bank ofScotlandand NatWest; Santander.

The lender will typically assess the business against their normal commercial lending criteria for instance with regard to the viability of the business, the ability to service the facility, and the availability of existing security, in order to determine whether they wish to lend.

There is no automatic entitlement to receive a guaranteed loan and nor is there any pre-qualification process for it. Decision-making on individual facilities is fully delegated to participating lenders and integrated with the commercial decision to lend. BIS plays no role in the application or decision making process.

Available from 28 April 2011. ExEFG will initially operate on a pilot basis and will be reviewed after six months. ExEFG backed facilities are available for periods of less than two years, in increments of three months.

Funding: ExEFG supports lending to viable SMEs, with an annual turnover of up to £25 million, seeking export finance facilities of between £25,001 and £1 million.

Type of Funding: Loan

Project Timeframe - Expiry Date: n/a

Eligibility: It is available to businesses in all sectors. ExEFG is used by lenders when addressing the export finance requirements of viable businesses which although they do not have sufficient security, can demonstrate to the lender that they have capacity to service and ultimately repay the facility in full.

Disclaimer: The information above was accurate at the time of publishing. This is a constantly evolving directory and we will amend the details as and when required. Regenerate Pennine Lancashire is not responsible for the accuracy of external information.

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