US Ex-Im Bank has introduced a new type of insurance policy that covers financing of exports of US machinery and equipment to foreign dealers for resale to local buyers.
The insurance covers three types of dealer financing under a single off-the-shelf policy, eliminating the need for the exporter or commercial lender to obtain multiple policy types. Ex-Im developed the product after extensive meetings with US exporters and lenders, who had expressed the need for such a programme. The dealer insurance policy provides innovative coverage of a type of financing that is specific to dealers: short-term inventory financing followed by the option to refinance the short-term debt for medium-term tenors, according to market standards.
“This new product is designed to strengthen Ex-Im Bank support for a strategic distribution channel for US capital goods exports,” says Jeffrey Miller, Ex-Im Bank senior vice-president and head of export finance. “Not only do foreign dealers help US companies penetrate local markets, but their ability to hold US machinery and equipment in inventory overseas allows them to respond immediately to resale opportunities.”