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Rise of the export underdog

Release Date

21 May 2015

It’s the classic story of the underdog; the small business competing on a global stage, breaking into foreign markets and winning export opportunities against much larger global competitors. By necessity, Australian exporters are among our most clever and resourceful companies. But many exporters stumble at the final hurdle because they can’t access timely finance.

“All too often, SMEs are being held back from developing their export business due to a lack a finance to support their growth or enable them to deliver on export contracts,” says Andrew Watson of Efic, Australia’s export finance agency.

Research conducted by Efic has now found that 57 per cent of small-to-medium businesses expect that access to finance will deteriorate over the year ahead.

“Their concern is often borne out of the business’s experiences with financial institutions, which have knocked back their requests for funding,” says Watson. “This can be due to exporters’ funding requirements typically not matching the standard lending criteria of banks.”

In a bid to help businesses grow internationally and achieve export success, Efic offers financial support when banks and the commercial market say ‘no’. Already noted for offering a wide range of solutions, including guarantees and bonds, the E is broadening its lending remit. This has been made possible by amendments to the Efic Act by Government, which have targeted the reduction of red tape and the costs of accessing finance.

“Our new flexible lending process means we can now lend directly for the export of all types of goods, not just ‘capital goods’” explains Watson.

“We have always been able to support exporters of capital goods, like a cow, but now it can also support exporters of consumable goods, such as milk and cheese.”

The Export Contract Loan is a new product which aims to simplify access to finance by streamlining the application form and approval process. 

“Through this new product, we are able to help those smaller businesses by providing finance directly to them, rather than providing a more complicated - and expensive - bank guarantee.”

Watson emphasises that Efic is a fall-back option. “We can provide financial support only when SME exporters are unsuccessful in obtaining the finance they need from their bank to support a specific export contract.”

Am I ready to export?

Many smaller businesses fall into exporting when they win a contract and are simply not prepared or set up for exporting. Efic has boiled down the essential questions that any potential exporter should ask of their business:

  • How do I know if export is right for me?
  • Where can I go for practical, relevant advice and information on exporting?
  • How do I set myself up for success with exporting?      
  • What do I need to think about when building an export strategy?
  • How do I identify the right export markets?
  • What do I need to think about when entering a new market?

Get in touch

If you would like further information or to have a discussion about funding solutions for your export business growth, please call 1800 093 724 or visit efic.gov.au

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