CREATING A MEANINGFUL WORKING CAPITAL GUARANTEE PROGRAM FOR THE SMALL EXPORTER: THE CASE OF THE U.S. EXIMBANK

Small exporters often confront a reluctance of financial institutions to extend short‐term credit lines needed to meet the manufacturing and related marketing costs associated with an overseas order. This problem has been particularly acute in the United States in the last decade as many regional banks sought to avoid such “international” risk as accepting foreign receivables as collateral for such a working capital loan. This paper examines the evolution and success of a newly‐enhanced Working Capital Guarantee Program instituted by the Export‐Import Bank of the United States (Eximbank) that encourages local financial institutions to extend lines that selectively enable smaller firms to meet export orders.