International Marketing Practices

Export-Import Bank of the United States (EXIM) The Export-Import Bank of the United States (EXIM) is an independent federal agency that provides significant financing and assistance to U.S. exporters with the intent of increasing domestic employment through expansion to foreign markets [190].The EXIM serves brokers, lenders, importers, and exporters, largely to drive sales expansion in foreign markets. To help facilitate this, they provide export credit insurance, financing assistance, and other opportunities listed below [190]. Protection against buyer nonpayment. The EXIM provides Export Credit Insurance to exporters for foreign receivables as a precautionary measure in case of buyer nonpayment. Should a buyer be unable to pay for the product, the seller is reimbursed by either a private bank or the U.S. government for a portion of lost profit, up to 95%. Financing. The EXIM works with private banks to help exporters receive financing overseas through both capital loan guarantees and export credit insurance that can increase borrowing power. Performance and bid bonds. Many foreign importers require letters of credit that serve as performance or bid bonds, but these often require cash payment as collateral, requiring a seller to tie up funding. This can be averted through the EXIM’s Working Capital Loan Guarantee Program, again backing a borrower’s debt to free up cash for use in export. Finance a foreign buyer’s purchase. The EXIM provides foreign buyers with opportunities typically unavailable in their home countries. These buyers must be creditworthy and are considered more favorably if the project is long-term, large- scale, and high-value. Borrow against inventory and accounts receivable. It is customary to take out loans against inventory or accounts receivable to fund business ventures, but many private banks do not allow borrowing on export assets. The EXIM provides both Export Credit Insurance, as well as Working Capital Loan Guarantees, in combination with private banks to allow exporters to invest in international trade. The EXIM also provides a variety of tools and information on their website, including a broker locator, applications and forms, working capital lender locator, country limitation schedule, credit standards, exposure fees, and others [190].

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