Gua­ran­tee for trade re­cei­va­bles

With EKN’s guarantee for trade receivables, you know that you will receive compensation should your customer not pay, which makes it easier for you to offer the customer credit. The credit period is limited to not more than 12 months. The guarantee protects against events that occur with effect from the date that the claim arises, which is normally when you deliver a product or service.

You can also use the guarantee as collateral if you choose to have a bank or other credit institution finance the transaction. In this case, you assign the claim and the rights under the guarantee to the financier.

Transactions that can be guaranteed with EKN’s guarantee for trade receivables

You can apply for a guarantee for trade receivables for different types of export transactions associated with the export of goods and services and leasing. EKN can cover both small- and large-scale transactions with this guarantee.

Application

You submit the application to EKN no later than the date on which you deliver, but preferably in good time beforehand. An application for an offer is free of charge. In the application you will need to answer a number of questions about your export transaction. You will also be asked to provide financial information about your buyer. You can apply for the guarantee using EKN Online.

On receipt of your application, EKN assesses the risk of the transaction and you thereafter receive an offer. The offer states the terms and conditions as well as the premium, or in other words what the guarantee will cost.

It is very important that you read EKN’s General Conditions as well as any supplementary conditions, prior to the issuance of your guarantee, so that you know what is applicable to the guarantee.

Extend the validity of the offer

Transactions can sometimes be lengthy processes. In such a case, it can be possible to extend the validity of the offer. If you wish to extend the validity of the offer, we will require updated information. You can apply via EKN Online or with the document below.

Request for guarantee

If you have received an offer from EKN, confirm the transaction and wish to take up the guarantee, you must send us a request that you wish to have the guarantee issued no later than 30 days after the claim arose, which is usually when you have delivered a product or service. You submit your request via EKN Online.

EKN issues the guarantee, and you pay the premium.

Pay the premium

EKN sends the guarantee documentation and invoices you for the premium. The premium must be paid within 30 days from the date of invoice.

In the event of default

When problems arise in a transaction

If you receive information about a change of circumstances that might lead to a problem in your transaction, it is important to inform EKN immediately.

It might be that your buyer’s or borrower’s financial position has deteriorated or that payments are delayed, or that the buyer has objections to the delivery. It might also be that the buyer has not met the defined environmental requirements.

Non-payment

If the buyer or borrower has not paid a claim covered by an EKN-issued guarantee within one month after the due date, you must, as the guarantee holder, notify EKN of this in writing.

Compensation from EKN

If payment is not received of a claim covered by an EKN-issued guarantee, you can apply to EKN for claim compensation.

The compensation is the claim amount minus your excess, if an excess applies.

The excess is the percentage of a loss that is not compensated under the guarantee. It is typically 5 per cent.

If EKN receives payment from the buyer, after compensation has been paid, you as the guarantee holder are entitled to the portion corresponding to your excess. EKN will normally pay you within 30 days of receiving payment from the buyer.

Payment respite and extension of term

When your customer cannot pay and you would like to agree to grant respite for payments in a guaranteed transaction, you are required to submit a request for EKN’s consent to the extension.

This also applies if you need to prolong the term of a contract guarantee, if the term is changed in a working capital credit guarantee or if the due date in a letter of credit is changed.

In order for EKN to receive the necessary information for such a decision you need to, as the guarantee holder, submit a separate form for your relevant guarantee. Complete the form and send it to the EKN official responsible for the transaction. If you have any questions, please contact your responsible EKN official.