Finnvera and the Chamber of Commerce: Finnish enterprises fail to close deals in export trade – financing options not well-known


Finnish SMEs involved in export trade are very likely to fail to close deals as they are not sufficiently familiar with the financing options offered to the buyer. They are not aware of the significance of buyer financing as a competitive advantage. During the past two years, one in five enterprises involved in exports have suffered from credit losses due to the buyer not paying its invoices. Indeed, export trade is restricted by the fear of credit losses. At the same time, many enterprises feel that they do not need to manage the financing risks associated with export trade. All this is revealed by the export trade financing barometer commissioned by Finnvera, Finland Chamber of Commerce and the International Chamber of Commerce ICC.

Larger enterprises that are actively involved in export trade are fairly familiar with export trade credit risk management and buyer financing options. Among SMEs, there is sometimes surprisingly little awareness of export trade procedures and available services.

“The Finnish economy is driven by exports but relies on large corporates. The share of SMEs in export trade is among the lowest in the Nordic countries. According to our survey, export trade deals have been lost due to factors related to financing or credit risk management, so improving export trade financing knowledge would make it possible to close more deals,” says Finnvera’s CEO Pauli Heikkilä.

A total of 39 per cent of enterprises that have failed to close deals in export trade reported that the buyer could not arrange financing. In addition, 11 per cent reported that the buyer had received financing on better terms from a foreign competitor. In both of these cases, enterprises could tackle the challenges with the help of a bank and an export credit agency. What is alarming is that the lack of buyer financing has especially affected enterprises that are strongly oriented towards growth and have the best potential for internationalisation.

One in five enterprises involved in exports took no measures to protect themselves from export trade credit risks

Half of Finnish enterprises involved in exports carry out export trade transactions with invoices and thus grant a payment period, even if it is a short one, to the buyer. Nevertheless, sales transactions with a payment period always involve a risk of credit loss as the buyer may leave the invoice unpaid.

Three out of four enterprises use advance payments in their export trade transactions to protect themselves from credit risks. Documentary credits, bank guarantees, credit insurance or Finnvera’s export credit guarantees are mainly known among the largest enterprises involved in exports. No fewer than one in five enterprises that responded to the survey had not taken any measures to protect themselves in export trade transactions. Nearly half of them estimated that no protection was necessary. A small percentage of the enterprises admit that they do not know the means of protection well enough.

“The majority of SMEs do not know the options available for protecting themselves against credit risks and, consequently, they are not able to benefit from these options in boosting their export trade. They fail to close deals or simply keep out of export markets for the fear of credit risks. Almost 60 per cent of respondents find that a single loss may jeopardise their operating capacity for a long time,” comments Timo Vuori, Chief Executive, ICC Finland.

Providers of financing, credit insurers and the Chambers of Commerce cooperating to improve enterprises’ financing knowledge

On the initiative of Finnvera, Finland Chamber of Commerce and the International Chamber of Commerce ICC, providers of export financing and credit insurers have decided to launch extensive cooperation to improve financing knowledge in SMEs involved in exports. In 2018–2019, a regional export trade financing tour will be organised. In addition to Finnvera and regional Chambers of Commerce, other tour participants include the largest banks operating in Finland and all private credit insurers.

“We have a shared interest and goal in promoting Finnish exports and economic growth. We will increase the amount of advisory services and, starting in the autumn, we will organise export financing workshops for enterprises around the country. We will go to enterprises and lower the threshold, with the aim of reaching the nationally declared goal of increasing the number of SMEs involved in exports,” emphasise Heikkilä and Vuori.

The survey was conducted by Taloustutkimus, commissioned by Finnvera, Finland Chamber of Commerce and the International Chamber of Commerce ICC, with an online survey and telephone interviews in April–May 2018. The survey was taken by 654 Finnish enterprises involved in direct export trade. In these enterprises, the share of exports of the total turnover is 42 per cent and the average export turnover is EUR 12.7 million.

Further information:

Pauli Heikkilä, CEO, Finnvera, tel. +358 29 460 2400,

Timo Vuori, Chief Executive, ICC Finland; Director, Finland Chamber of Commerce, tel. +358 50 553 5319,

Appendix: Survey summary (pdf, in Finnish)


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