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Trade Credit Insurance backed by £10 billion guarantee

Thursday June 4th, 2020

Government to provide guarantees of up to £10 billion to Trade Credit Insurance schemes for business-to-business transactionsPen and pounds

Trade credit insurance coverage to be maintained across the market in light of COVID-19, with up to £10 billion government backing

measures will support thousands of businesses by protecting against customer defaults or payment delays

scheme is available on a temporary basis for nine months, backdated to 1 April 2020, and available insurers operating in the UK market

Trade Credit Insurance, which provides essential cover to hundreds of thousands of business-to-business transactions, will receive up to £10 billion of government guarantees, ministers announced today.

The Trade Credit Reinsurance scheme, which has been agreed following extensive discussions with the insurance sector, will see the vast majority of Trade Credit Insurance coverage maintained across the UK.

The guarantees will support supply chains and help businesses during the coronavirus pandemic to trade with confidence, safe in the knowledge that they will be protected if a customer defaults or delays on payment.

The scheme is available on a temporary basis for nine months, backdated to 1 April 2020, and running until 31 December 2020, with the potential for extension if required.

The scheme will be followed by a joint BEIS/HMT-led review of the Trade Credit Insurance market to ensure it can continue to support businesses in future.

BCC Director General Adam Marshall said:

“The government has demonstrated once again that it is listening to the concerns of our business communities.

The launch of a government-backed guarantee to support the provision of trade credit insurance will help ensure that this vital lifeline remains available to businesses during and after this crisis, helping to maintain supply chains and trade.”

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