Alternatives to banking facilities

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Importers and exporters face uncertainty every day as exchange rates fluctuate, customer demand evolves and competitors adapt their strategies. Finding the right methods to bring confidence to your trading becomes all the more important. Securing payment and managing working capital will be high on the list, expected by your investors as much as your customers and suppliers.

Many businesses depend entirely on their bank to provide financial support and facilities for trade. While there may be the advantage of a single point of contact, the costs can be high and there is less flexibility. More importantly your working capital may be constrained. The costs charged by your bank or other provider may also be high, putting pressure on the margin you expect to earn. Using your bank could have an impact on other banking facilities.

Using bonds and guarantees will put more control in your hands and more flexibility in your use of finance. A Letter of Credit Alternative or Payment Guarantee from an insurer may well prove to be a more appropriate solution for your business. Deductible Guarantees and Advance Payment Bonds offer competitive rates, and will support your contractual obligations while freeing up your bank facilities.

Most importantly a bond won’t restrict your working capital or banking facilities. It will be treated as a 'contingent liability' rather than as a debt to the bank which means it is 'off-balance sheet’.

We can meet the need for alternatives to banking facilities with a portfolio of bonds and guarantees that have been specifically designed to support international trade. Practical answers that give you the freedom to trade with confidence.

Providing guarantees brings significant advantages to companies in many sectors. Guarantees and securities are legal transactions where the guarantor takes on the obligations of a third party towards a creditor. You may be able to diversify the funding for our business as guarantees can be alternatives to a bank loan. They are used worldwide and can be essential for public sector contracts. We are experts in guarantees and insurance for securitized bundles. We provide you with a choice of bonding, guarantees and securities to satisfy your obligations in many kinds of legal transactions. Our contract securities, customs securities, and environmental bonds will support your sales process and satisfy the requirements for bids and tenders.  When you work with us, you benefit from the experience of Euler Hermes specialists who will design the optimal arrangement for your line of business and markets. Our guarantees and bonds are based on an AA- rating from Standard & Poor's