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Revolving Buyer Credit Cover

Insuring export business as bank

Product at a glance

Revolving buyer credit cover enables banks to insure their receivables under a loan agreement on the financing of a German exporter's regular, short-term export transactions with a specific foreign buyer. The policy period of a Revolving Buyer Credit Cover is one year and it will be automatically extended unless notice of termination is given in due time, at the latest one month before the expiry.

 

Target group

  • German banks
  • Branch offices of foreign banks in Germany
  • Foreign banks (under certain conditions)

 

Payment terms of the covered transactions

Short-term (up to 12 months, in exceptional cases up to 24 months)

 

Insurable risks

Revolving buyer credit cover offers protection against payment default, particularly if

  • the borrower becomes insolvent
  • the borrower fails to make payment within one month after due date (protracted default)
  • adverse measures taken by foreign governments or warlike events
  • local currency amounts are not converted or transferred

 

Special features

Interest agreed in the loan agreement can be covered only up to a rate of 8 % annually.

The exporter need not submit a separate application in respect of the transactions to be included in the cover and is not granted his own separate Hermes Cover for them. However, specific arrangements ensure that the exporter is protected in a way comparable to supplier credit cover.

As a rule, cover facilities are available for all countries, with the exception of exports on credit terms of up to two years to EU and core OECD member states (i.e. EU member states, Australia, Canada, Iceland Japan, New Zealand, Norway, Switzerland, United Kingdom and USA); for a limited period of time until the end of 2020, Export Credit Guarantees of the Federal Republic of Germany are also available for these normally marketable countries (German version). Additional information

 

Premium

  • A certain percentage of the order value covered (interest excluded) as well as specific processing fees
  • For a detailed calculation there is an interactive premium calculator (German version only)available.

 

Uninsured portion

5 % for all risks

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