Men cementing
Financing Guarantee B/E

Avoid the risk and receive your money immediately


Letters of credit (ILC or L/C) and bills of exchange (B/E) are internationally recognised as payment for exports to customers abroad. When you receive a letter of credit or a bill of exchange from abroad, you can ask your bank to assume the risk, so you will receive your money immediately. In this way, the bank will be liable for the risk if the payment from abroad is not made as agreed. But the bank may assess the risk as too high. This is where EKF comes in. A Financing Guarantee from EKF will cover you in the event of problems with the payment.

What we offer


You can help your customer obtain a loan so you can win the order.
EKF assumes the risk and your bank can offer your customer credit.
We cover losses arising from political and commercial problems abroad.
You are better positioned to seek out new markets and new customers.

Requirements for your business


The credit period must be minimum 181 days.
You have a deductible of at least 10 per cent.
Your foreign customer is normally required to pay at least 15 per cent of the order amount in advance when the credit period exceeds one year.
Your company must help to generate economic growth in Denmark.
Your business must be conducted on an environmentally sound and socially responsible basis.

How a Financing Guarantee works

EKF provides a guarantee to your bank for the credit extended to your foreign customer. In doing so, we assume most of the risk. The credit extended by the bank to your customer is financed by bills of exchange. This enables the customer to place the order with you.

You receive payment on delivery, even though your customer pays via credit.

The process

How to get a Financing Guarantee

1

You want security of payment and to receive your money quickly

Your foreign customer wants credit for the order and uses a letter of credit or a bill of exchange as payment for the order. Conditions in the country are unstable and involve a risk of loss. Moreover, you would like your bank to finance your customer's credit, so you will receive payment for the order that way.

2

Your bank requires security in order to assume the credit risk

Your bank is hesitant to be involved, as there is a risk that the payment from abroad will not be made as agreed. Your bank therefore requests security for the payment.

3

We run a credit rating check on your export transaction

Your bank asks EKF to assume the risk in the form of a Financing Guarantee. However, we must first run a credit rating check on your customer and possibly the foreign bank to establish the extent of the risk. This includes a CSR screening. If the guarantee amount is above DKK 25 million, a more in-depth CSR assessment will be required.

How we work with CSR
4

The paperwork

Once we have agreed to assume the risk, we send a few documents for your bank to fill out and sign.

Relevant documents for the Financing Guarantee
5

Offer

We send the bank an offer setting out the coverage, price and conditions.

6

And we're done

We then issue the Financing Guarantee, which covers up to 95 per cent of the risk of political and commercial losses related to the payment from abroad. This gives you the peace of mind to focus on your company's exports.

The small print and relevant documents

Contact an advisor

Any questions about Financing Guarantees?


If so, call or write to Deputy Director for SME & Cleantech Karsten Ipsen on telephone +45 3546 2660 or E-mail ki@ekf.dk.

Does a Financing Guarantee not cover your needs? Consider these options: