Concluding an export contract may require that the customer is provided with financing. The customer may already request a financing offer during the bidding stage, which means that the ability to arrange the financing will give the exporter a competitive edge.
The buyer credit for a foreign customer is granted by a bank and Finnvera can share the risk with the bank by providing it with a buyer credit guarantee. Thus, as the exporter contacts Finnvera, it should also start discussions with potential providers of financing.
Finnvera can, within the framework of the OECD export credit agreement, be a party to financing arrangements in buyer credits with a credit term of at least two years. The buyer credit guarantee may also be used in short-term exports. In such cases, a bill of exchange, a promissory note or other transferable debt instrument must be used as the payment instrument and the exports must be destined for non-EU countries or other countries outside the western industrialised world.
A letter of credit is a safe payment method in export trade. Finnvera's letter of credit guarantee makes it easier for banks to confirm letters of credit issued by foreign banks. The guarantee is provided to the bank confirming the letter of credit and it protects the bank against the political and commercial risks associated with the bank issuing the letter of credit.
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