Boeing has become the latest US exporter to help its eligible small business suppliers gain access to affordable financing through participation in a supply chain financing (SCF) programme guaranteed by the Export-Import (Ex-Im) Bank of the US. Boeing is notifying several hundred qualifying US-based suppliers that system testing is complete for the new financing programme, to be operated by Citibank NA (Citi), allowing sign ups to proceed and payments to flow.
The Ex-Im programme, first offered in 2009, allows small businesses involved in exporting non-military goods to receive attractively priced working-capital financing. It is done through early payment of their accounts receivable, in this case from Boeing, in exchange for a small discount fee paid to Citi for those receivables accepted for the program. The programme is part of Obama Administration’s National Export Initiative to double US exports within five years.
At a time when economic recovery continues, Ex-Im’s programme helps inject liquidity into qualifying small businesses, providing faster access to needed cash flow. Ex-Im provides a 90% guarantee of the eligible invoices while a lender, such as Citi, bears 10% of the risk.
“Increasingly Boeing has called on small business to help us in sustaining export-related jobs. The SCF programme is a great tool to encourage this key growth area to prosper,” said Tom Dillon, Boeing corporate finance director who led the financing program’s implementation. “Small business can truly join larger exporters in working together to grow much needed jobs supported by demand for American products the world wants.”
The Boeing supplier programme was authorised in September 2011 with Ex-Im Bank’s approval for an initial US$740m capacity.
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