A guide to export finance

More and more UK businesses are being encouraged to start exporting with the government backing them with the new ‘Made in the UK, Sold to the World’ strategy.

Export finance explained

This helps businesses across the UK double exports and sell their world-class products around the globe.

The need for export finance

According to the Confederation of British Industry (CBI) less than 10% of UK businesses currently export* despite there being an appetite for British products and services in overseas markets. Why is that?

When looking to export and trade overseas, having the finance to do so is important. You will either need to have enough money in the bank to produce goods for resale to an increased customer base, or have access to credit facilities that enable you to do so.

In many instances, this is a luxury that many smaller businesses cannot afford. One of the key barriers to trading overseas is access to finance, and having sufficient working capital to fulfil larger orders, maintain stock levels, raw materials, finished goods and for contingencies.

By analysing cash flow, current market conditions and performance, businesses are able to establish if the possibility of trading overseas is one they can make a reality in the short, mid or longer term, and what, if any, trade finance may be required in order to accommodate the potential for international growth. There was a time when global trade finance was mainly geared towards larger businesses with a more established history of trading. However, there are now a growing number of Fintech and other finance providers, who specialise in helping small businesses to sell their products overseas.

Which is where the UK Export Finance’s (UKEF) General Export Facility (GEF) comes in.

What is GEF?

UK Export Finance (UKEF) is the UK’s export credit agency. They launched an export finance scheme; the General Export Facility (GEF) in December 2020 which is designed to provide exporting SMEs access to working capital loans to support businesses through their COVID-19 recovery journey.

Newable has been accredited under the UK Export Finance’s General Export Facility (GEF) programme as the first non-bank lender to join the initiative which includes five existing lenders; HSBC, Santander, Barclays, Lloyds and NatWest.

Why Trade Finance?

To obtain working capital finance, the financial performance of the business and creditworthiness are considered. Borrowers also need to demonstrate the integrity of trade receivables and the ability to meet repayments and any interest rates attached.

Newable’s unique Trade Finance fund, supplied by UKEF, is a loan to fund additional working capital for companies who already export. This loan can be used for any business purpose, but most often used to win and deliver on new contracts. The loan is designed to be quicker and a more flexible alternative to traditional trade finance or export finance products.

Am I eligible?

Newable Business Loans provides unsecured loans for exporting businesses of up to £150,000.

To be eligible for support, businesses must meet several criteria including:

  • Need to be a UK based, limited company with at least 3 years trading history
  • At least 5% of revenue comes from exporting for the last 3 years
  • Cash flow positive
  • Exporting goods or services manufactured or delivered from the UK

We can help

Newable has spent the last decade advising UK businesses on how to secure export wins. With a 4.8/5 Trustpilot rating, you can be assured you’ll be in safe hands with our expert team.

Our finance product is one of the only trade finance products built for smaller businesses.

Wish to maximise business growth via exporting?

Apply for trade finance today

*CBI : https://www.cbi.org.uk/our-campaigns/make-the-uk-an-exporting-superpower/