A buyer in a growth market wants the equipment and has the project to put it in. What it often lacks is the cash to pay on delivery, and its local bank will only lend over a short tenor against collateral. For a Dutch exporter, the sale stops there unless payment terms can be offered.
Supplier credit
The exporter agrees deferred payment with the buyer and insures the receivable under export credit cover. There is one contract and one counterpart, and the buyer does not go through a bank process. The insured receivable can then be sold to a bank, so the exporter is paid when the goods are delivered.
Buyer credit
A bank lends to the buyer, or to its project, under cover from the export credit agency. The exporter is paid on delivery from the loan, and the buyer repays the bank over the tenor the cover allows. This is the usual route for larger purchases and for equipment that forms part of an EPC contract.
Several suppliers, one facility
When a buyer sources from several Dutch suppliers, the purchases can often be bundled under one cover and one facility. The buyer then deals with a single counterpart and a single credit line.
Where to start
Which route fits depends on the purchase value, the buyer's country and how much of the contract is Dutch. Country policy is set by Atradius DSB on behalf of the Dutch State, so its country cover list is the first thing to check. We then look at the transaction with the exporter and the buyer, choose the route and prepare the file for the bank and the agency.
Gabriel Moreira
Founder and Managing Partner
