Swiss Export Risk Insurance (SERV) insures export transactions against political and economic risks. As part of its offer, SERV supports Swiss exporters in retaining their liquidity, thereby facilitating the handling of international orders.

Following difficult months on the global market, the situation in some industries is gradually relaxing. Nevertheless, export-oriented Swiss businesses are facing another problem: liquidity bottlenecks. To accept new international orders, the companies need financing. However, their guarantee and credit limits at banks are often almost or even fully exhausted. Thus exporters need to provide additional collateral in order to receive the loans or guarantees they require. In extreme cases, this can curb their liquidity to such an extent that they are unable to accept attractive and unproblematic orders. Therefore SERV and Credit Suisse have solutions.

New products provide systematic support
To systematically support Swiss exporters in this situation, SERV introduced new products in May 2009 within the framework of phase II of federal stabilisation measures. As an institution of the Swiss Confederation under public law, SERV insures political and economic risks of export transactions. "With our new offers, we make sure that exports do not fail due to the exporter’s lack of liquidity", explains Herbert Wight, Director of SERV. Working capital insurance and the counter guarantee, in particular, serve this objective. Both products protect the bank granting the loan or guarantee from default of payment on the part of the exporter. Thus, they enable banks to grant new loans or guarantees without fully charging them to the credit limits of exporters.

Liquidity for exporters thanks to counter guarantee
Netstal-Maschinen AG, headquartered in Näfels in the Swiss canton of Glarus, is one of the companies that have benefited from this scheme. SERV supported the company with a counter guarantee for the export of an injection moulding system for the production of PET preforms to China. In the past, Netstal had experienced situations where Chinese companies paid part of the invoice amount only after one or two years due to local payment practice. The current economic setting does not permit Netstal to wait so long for its money. "We depend on getting our money quickly", explains Waldemar Schmitke, Head of PET Production Systems at Netstal. For this transaction, Netstal thus agreed the immediate payment of the full invoice amount with the private Chinese customer. In return, the customer requested a performance bond to protect itself in case Netstal failed to comply with its contractual obligations. However, the issue of such a guarantee strains Netstal’s credit limits at its bank. To avoid this, Netstal used a SERV counter guarantee. In this way, the company was able to accommodate the needs of its customer while at the same time retaining its own liquidity. "We thus have the necessary leeway for further business," concludes Schmitke.

SERV products facilitate handling of export orders
Apart from the newly introduced products, SERV also features a wide range of conventional insurance products. Among other things, it covers supplier credits or the production cost of export goods. As a long-standing customer, Netstal has already used SERV offers several times and intends to continue doing so in the future. "SERV products help us to make business happen", says Schmitke. And that is what Swiss exporters sorely need in the current economic situation.

Swiss Export Risk Insurance SERV
Swiss Export Risk Insurance (SERV) provides insurance cover to Swiss companies for exports to economically or politically unstable countries. As an institution of the Swiss Confederation under public law, SERV operates on a subsidiary basis, i.e. in addition to the offers of private credit insurers. With its insurance products, SERV contributes to the competitiveness of Swiss exporters in the international arena and to the creation and preservation of jobs in Switzerland.
As well as the export of consumer and capital goods, SERV also insures the export of services such as construction, maintenance and engineering projects or licence and know-how agreements. There are no minimum requirements for SERV insurance with regard to company size or order volume. However, the exporter submitting the application must be based in Switzerland, and the export transaction must include a certain proportion of Swiss value added.

Get in contact with your Relationship Manager at Credit Suisse or Contact Toll-Free 0800 80 80 50 and we help you to realize your export projects.