ECGA Oman provides SME pre-shipment financing

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The guarantee issued by Oman’s Export Credit Guarantee Agency (SAOC) to banks fills the security gap needed by them for extending pre-shipment financing to the credit insured exporters. It has been designed for exporters to obtain timely and adequate credit facilities from banks at pre-shipment stage for purchasing of raw materials, manufacturing, processing and packing of goods to be exported, against contract for sales, i.e., irrevocable letter of credit or confirmed purchase order. Hence the scheme allows the credit insured exporters to obtain the necessary working capital financing from their banks in order to execute export orders abroad and avail more export business opportunities. This working capital financing of exports is highly useful for SMEs that lack necessary traditional collateral of their own which normally commercial banks demand from them. Thus, the guarantee issued by SAOC substitutes such collateral and provides opportunities for the exporters and SMEs to avail pre-shipment financing.

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