UK Export Finance (UKEF) has signed a memorandum of understanding (MoU) with specialist financier Falcon to collaborate on supporting British exports.
Under the terms of the agreement, UKEF and Falcon will share research, engage in joint marketing activities to promote exports and refer clients to each other.
Though the MoU does not include co-financing or the application of UKEF guarantees to Falcon financings, Falcon CEO Will Nagle tells GTR this would be a logical next step.
“By way of joint initiatives, joint marketing programmes, and Falcon assisting with the business development managers within UKEF, we feel that they’ll get to know more about what our capabilities are and vice versa,” he says.
The agreement, which was initiated by UKEF, is the first such collaboration between the ECA and a non-bank financial institution, signalling the growing role alternative financiers have to play in supporting UK exports, particularly in the SME space.
It would be remiss of us not to recognise the significance of specialist financiers and the part that they can play in supporting UK exporters. Paul Croucher, UKEF
Speaking at a panel on alternative funding for SMEs at GTR’s UK Trade and Export Finance conference in Birmingham just last week, Dints managing director Geoffrey de Mowbray said: “I don’t think they’re quite ready for it yet, but it will be interesting to see if one day an alternative lender will become an approved lender through UKEF. If you look at what Alibaba has done for Chinese exports, and the fact that now you can use China Construction Bank funding through that, that would be a very interesting dynamic to see.”
With today’s agreement, UKEF is one step closer to delivering that type of service. “UKEF understands the place for specialist finance market in the UK,” says Paul Croucher, head of trade finance and insurance solutions at the ECA. “It would be remiss of us not to recognise the significance of specialist financiers and the part that they can play in supporting UK exporters.”