There is an increasing amount of pressure to increase the export level from the U.S. This push has led to the signing of such agreements as the National Export Initiative (NEI) in an effort to support job creation and increase export levels.
In terms of small businesses, this will make it that much easier to expand their export business. Current exporters will be able to export at larger levels and even expand in order to export to even more countries. Benefits like reduced government requirements, increased foreign advocacy, better access to export financing and increasing contact with foreign traders are all important for business growth and expansion.
This Executive Order makes provisions for the Export-Import Bank to double its trade finance abilities from $21 billion in 2009 within the following five years. In addition, the bank is also making special financial provisions to help small and medium sized businesses with an additional $2 billion per year.
The question that many small business owners have is how to go about pursuing this new funding option in order to expand their businesses on an international level.
Firstly, they will need to approach the SBA (Small Business Administration). The SBA will provide them with all the necessary information and resources regarding regulations of foreign countries and local U.S. laws that affect international trade and business in general. They have also developed a number of small business financing programs like the EWCP.
The EWCP (Export Working Capital Program) proudly provides guarantees of as much as 90% of the loan amount to banks that are prepared to finance export orders, receivables or letter of credit. Businesses that are already operating on an international level can then make use of this program in order gain access to much needed funds for working capital. Alternatively, they can use the funds to help them increase their sales numbers or the countries to which they export their goods.
The SBA has confirmed that the EWCP loans are used to finance transactions. In other words, this particular loan will support the full supplier cost for an export transaction.