Insurance of trade receivables (claims)
Payment schemes related to agreements, commodity exchange and services are of key importance in the field of international trade.
Exporters may obtain a significant competitive advantage over the other potential suppliers, i.e. their international competitors, by providing deferred payment instead of prepaid payment for their existing or new foreign partners. However, in these cases it is logical for them to raise the question whether the partner will definitely pay after the delivery or how the exporter will be able to manage the related risks.
Export receivables insurance provided by EXIM is aimed at solving this problem. The greatest benefit of this insurance is that EXIM takes over the exporter’s default risks related to the foreign partner, enabling the exporters to negotiate about an even 2-year deferred payment deadline - conferring a significant international competitive advantage - with their partners as they can be confident that they will receive the price of the delivered commodities or services in the end.
As this insurance allows the exporter to be covered against losses caused by the buyer’s economic situation as well as against country risks beyond the partner’s control, it is worth considering its usage both in the case of new partners and partners from countries with unstable political situation. Besides covering risks connected to export transactions with deferred payment, the insurance is also advantageous from the point of view of improving the liquidity of the exporters who can offer the secured claims for sale to EXIM whereby they can immediately obtain almost 100% of the price of the product delivered on deferred settlement terms.