The purpose of Finnvera’s Refinancing Guarantee Scheme is to enable funding for banks using Finnvera’s Buyer Credit Guarantee and to thereby increase the sources of financing for export transactions.
Banks using Finnvera’s Buyer Credit Guarantee can refinance the underlying buyer credit or part of the credit in the capital market based on Finnvera’s Refinancing Guarantee.
First a bank provides an export credit to a borrower and gets a Buyer Credit Guarantee against credit risks from Finnvera. Then the bank applies for a Refinancing Guarantee in favour of a financing institution providing refinancing. The Bank and the provider of refinancing then agree on refinancing the original export credit, and under its Refinancing Guarantee Scheme Finnvera issues a 100% Refinancing Guarantee in favour of the provider of refinancing.
The refinancing arrangement is an alternative for the Finnish Export Credit´s funding model.