Secu r i ng F i n a n ci n g f o r Ex port In it iat ives
STACEY PIERCE
MARKETING &
COMMUNICATIONS
MANAGER
Florida SBDC at USF
C
] O N N E C T
sbdctampabay.com
THE PRACTICE OF
SALES OF PRODUCTS
OR SERVICES IS
BECOMING MORE
GLOBAL BY THE
DAY, AND FLORIDA
COMPANIES HAVE
TAKEN NOTE.
FROM SERVICE
PROVIDERS TO
MANUFACTURERS,
MORE AND MORE
COMPANIES ARE
SEEKING EXPORT
ADVICE AND
REACHING TO THE
FLORIDA SBDC AT
UNIVERSITY OF
SOUTH FLORIDA FOR
EXPORT ASSISTANCE
AND CONSULTATION.
Beyond the
considerations of
“internationalizing”
the product or service,
finding the proper
foreign markets, and
learning about tariffs
and freight, company
owners and managers
are often faced with an
all-common challenge.
It’s hard enough to get
financing for domestic
operations. How can
the company finance an
export initiative?
Javier Marin is a
financial analyst and
provides guidance
through the process of
acquiring financing for
domestic and export
operations.
According to Javier
Marin, Certified Global
Business Professional
(CGBP) and financial
business consultant with
the FSBDC at USF, banks
look at working capital
export financing as one
of the riskiest credit
deals simply because the
collateral is beyond the
confines of US territories
and highly unlikely to
be liquidated in case of
loan default.
“Banks want to help
their clients, but the
primary premise behind
extending financing to
a client, from a bank’s
perspective, is that the
loan will be repaid and
that there is recourse if
it’s not,” Marin, a 21 year
veteran of the banking
industry, said.
Marin adds that
a combination of
programs by the
Export-Import Bank
of the United States
(EXIM) and the Small
Business Administration
(SBA) provides
loan guarantees to
banks who want to
consider extending
credit to businesses
contemplating starting
or expanding export
activities and have been
in business between
12 and 36 months,
depending on the
program.
For financing up
to $500,000, the SBA
Export Express program
provides the lenders
with guarantees for
credit extension to
qualified businesses for
export development;
export transactions;
standby letters of credit
and or fixed asset
acquisitions. EXIM’s
Global Credit Express
provides short-term
direct financing for
general export activities
or specific export
transactions.
According to Marin,
the SBA’s CAPLines
and Export Working
Capital Program
(EWCP) loans can go up
to $5 million and may
be used for working
capital purposes to
cover production
costs (inventory, labor,
materials, etc.) as well
as freight costs and
insurance on freight
and foreign accounts
receivable. Other
allowable expenses
under the CAPLine and
EWCP include letters
of credit to guarantee
performance, bids or
advance payments.
The EXIM Bank
also provides a
Working Capital
Guarantee Program
for similar purposes
but for requests
over $5 million.
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