As the government launches a new initiative to help exporters – the ABL industry has been doing it for years!
Borrowing ideas seems to be in vogue at the moment, what with Mrs May looking to govern by some form of cross-party consensus and Mr Corbyn sending her a copy of the Labour election manifesto, some people might be led to believe that the country could end up with the best bits of all current political policy in place.
Don’t hold your breath on that one!
On the business side, Trade Secretary Liam Fox is due to announce a new deal with the country’s biggest high street banks aimed at extending millions of pounds to SMEs in the hope that it will boost their export ambitions post Brexit.
In a statement that leans more towards the Minister for Stating the Obvious than the Trade Secretary, Mr Fox said the provision of finance “lifts a common barrier to exporting”
With the coffee well and truly smelt the deal offers a government guarantee of 80% to banks providing export related finance to what they consider smaller and riskier businesses.
Finding & Funding
Finding suitable export markets has always been an issue and one that takes a great deal of research and effort on the part of business owners. Luckily, thanks to alternative finance providers within the asset based lending industry, actually funding for exporters has been possible for a long time now.
Although not every finance providers’ cup of tea, there are a number out there with the appetite and expertise to offer support to clients selling overseas. And as well as the cash element giving a much needed boost to working capital they can provide valuable add-on services vital to any business not big enough to have its own presence in different countries.
You don’t have to whistle for your money
With the ability to provide multi-lingual debt chasing, multi-currency transactions and insurance against bad debts, all of those scary elements for the toe-dipping exporter can be taken out of the equation altogether.
Support doesn’t just go one way either. Businesses importing can also find help from an industry that truly understands the issues, value and rewards of international trade.
As for the government, reportedly worried that the UK domestic economy could head south once the decree absolute is issued, providing a boost to exporters is fairly key to its wider Brexit plans on the matter. And let’s face it, any help for the engine room of the British economy is welcome.
But whilst Mr Fox might say the aim of the deal is to help SMEs “seize the global demand for British exports” a cynic might ask what’s the good of throwing money at exporters when the situation of possible tariffs and quotas is unknown and trade deals with 27 other EU countries, plus those enjoyed with the rest of the world via the EU, are about to expire?
I don’t expect many postcards – the brains in Whitehall are still struggling with that one.
By Steve Leeves