IFC introduces trade insurance policy
The IFC has taken out a US$532mn trade credit insurance policy to expand the capacity of its global trade finance programme (GTFP).
The credit policy, which is underwritten by nine insurers and brokered by Marsh, protects IFC against the risk of default by a local bank client and initially covers 50 local banks in 30 countries. The policy marks IFC’s first insurance cover to expand its trade credit facilities.
Commenting on the policy, Georgina Baker, IFC’s director of short-term finance, says: “IFC is playing a leadership role in driving global trade through the GTFP and creating lasting partnerships that are bringing economic growth and job creation to some of the world's poorest countries.”
“This new facility will help our partner banks to increase their business with small and midsize firms in emerging markets and enable trade that otherwise would not have happened,” she adds.
Since its inception in 2005, the GTFP has issued more than 10,000 guarantees totalling US$14.3bn to banks on trade-related payment obligations.
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