Image: Perspective from above on a container ship in the port

Product overview for financial institutions

All forms of cover for your foreign financing at a glance.

Financing of recurring export transactions

Cover your loan receivables from recurring export financing 
transactions with a foreign buyer or transactions under a credit line/
framework credit with several exporters with one foreign buyer.

Revolving Buyer Credit Cover

Revolving buyer credit cover enables banks to insure their receivables under a loan agreement on the financing of a German exporter's regular, short-term export transactions with a specific foreign buyer. The policy period of a Revolving Buyer Credit Cover is one year and it will be automatically extended unless notice of termination is given in due time, at the latest one month before the expiry.

Protection against payment default arising from recurring export financing – one buyer, one country

  • Up to 12 month credit period, in exceptional cases up to 24 months

Shopping Line Cover

Shopping line cover aims at providing access to the procurement programmes of large foreign customers with good credit ratings. To achieve this, it offers banks the possibility to obtain cover for a credit facility granted to be drawn on for this purpose. It may be used for export transactions which have been executed and paid for in full (reimbursement procedure). For the utilisation these transactions of various German exporters are pooled in one or several tranches each with a uniform repayment profile. The respective loan receivables are covered by the Federal Government under shopping line cover, a buyer credit guarantee which is modified by Special Terms and Conditions for this type of business.

Protection against default of loan receivables under a credit line from several German exporters (tranches)

  • Short term: up to 24 month credit period
  • Middle-/long term: 2 years and longer

Framework Credit Cover 

With Framework Credit Cover banks can insure their receivables arising from individual loans granted under a general loan agreement (credit line) to finance German export transactions.

Protection against payment default arising from credit facilities granted to be drawn

  • Middle-/long term: 2 years and longer

Financing of single transactions

Protect your loan receivables arising from single export financing 
transactions with one foreign buyer.

Hermes Cover click&cover BANK

Hermes Cover click&cover BANK enables German Banks to obtain cover of buyer credits for straightforward export transactions quickly and easily online from the Federal Government.

In order to guarantee small and medium-sized enterprises a rapid processing, Basically, it is available for transactions in countries classified in risk categories 1 – 5 and with credit periods of up to 5 years.

Protection against payment default arising from single export transactions

  • Short term: up to 24 month credit period
  • Middle-/long term: up to 5 years credit period

Buyer Credit Cover

Buyer credit cover enables banks to insure their receivables arising from the financing of a German export transaction.

Protection against payment default arising from single loan recievables

  • Short term: up to 24 month credit period
  • Middle-/long term: up to 5 years credit period

Leasing Cover

With leasing cover a German lessor (manufacturer/exporter or leasing company) protects himself against the loss of the amounts owing from a foreign lessee under a cross-border lease.

Protection against payment default arising from single export transactions

  • Short term: up to 24 month credit period
  • Middle-/long term: credit periods 2 years and longer

Credit Confirmation Risk Cover

With buyer credit cover against credit confirmation risks a bank insures itself against the risks involved in the confirmation of a letter of credit that has been issued to finance an export transaction of a German company. It is available in particular for confirmed letters of credit and irrevocable purchase commitments.

Protection for receivables arising from documentary credits granted to finance a German export transaction, in particular confirmed letters of credit and irrevocable purchase commitments

  • Short term: up to 24 month credit period
  • Middle-/long term: credit periods 2 years and longer

Supplementary cover

Protect yourself against more risks that may 
arise in the export transaction.

Forfaiting Guarantee

The Forfaiting Guarantee makes it easier for the exporter to refinance its small-ticket transactions covered under an Export Credit Guarantee of the Federal Government. It gives the exporter access to more liquidity and reinforces its position in international competition.

Protection of receivables resulting from cross-border deliveries having a contract value of up to 10 million euros (or the euro equivalent).

·         Short-term (up to two years)

·         Medium/long-term (two years or longer)

Learn more about how you can expand your financial leeway for your foreign business on our product page:

Counter-Guarantee (as beneficiary)

The Counter-guarantee complements a Contract Bond Guarantee and thus cannot be used independently. It enables German exporters to ease the pressure on their credit lines. Especially small and medium-sized companies can enhance their liquidity with it. 

Buyer credit cover against credit confirmation risks is not an independent form of cover. For this a Buyer Credit Guarantee is amended by Special Conditions. 

Protection of exporters against recourse claims by financing institutions.

Covered Bond Guarantee

A Covered Bond Guarantee gives banks financing export transactions more flexibility when refinancing the export credits they granted in their own covered bond business (German covered bond; "Pfandbrief"). 

Protection against the withdrawal of covered bonds in the event of insolvency/insolvency of the bond institution outside Europe e.g. by a creditor of the bank.

Securitisation Guarantee 

In addition to the Securitisation Guarantee for refinancing through commercial banks or on the capital market (VBG-E), the Federal Government introduced an the Securitisation Guarantee for the refinancing of Hermes-covered export credits extended by commercial banks through “Pfandbriefbanken” (German covered bonds banks) (VBG-R). The purpose is to improve the commercial banks’ conditions for export finance.

Liquidity facilitation through access to refinancing for Government-backed loans or improved terms.

Securitisation Guarantee for the KfW Refinancing Programme

Kreditanstalt für Wiederaufbau (KfW) offers a programme for long-term refinancing to the German export industry on behalf of the Federal Ministry of Economic Affairs and Climate Action provided that the transactions in question are covered under a Buyer Credit Guarantee or Airbus Guarantee and, in addition, a Securitisation Guarantee from the Federal Government.

New: The programme, which has been limited in time so far, will be offered for an unlimited period of time as of 01.01.2021. At the same time, the conditions, which have to be met by of the commercial banks will be improved (i.a. elimination of specific minimum interest requirements).

Liquidity facilitation through access to long-term refinancing via KfW for Government-backed loans or improved terms.

Specific export cover

Protect your receivables against payment defaults 
arising from project businesses or structure projects.

Project Financing

Project finance transactions are major projects where the operating costs and the funds for interest and redemption payments on the loans taken out are generated by the project itself. They centre round a legally and economically independent special purpose company ("SPC") which acts as borrower. Hence project finance is a form of finance which focuses on the direct revenues of the project (cash flow related lending) which does not appear in the financial statements of the investor (off balance sheet financing).

To protect against bad debt losses in large-volume investment projects, die economically independent Special Purpose Companies (SPC's) can cover manufacturing risks and payment default risks, and banks can cover the uncollectibility of loan receivables.

Promotion of climate-friendly exports

Global climate change is one of the biggest challenges that lie ahead in the coming years. The Federal Government supports the further development and transfer of climate-friendly, efficient high-tech products also by means of initiatives in the field of export promotion.

Special requirements / Protection against bad debt losses through improved conditions

  • Up to 22 years credit period
  • Inclusion of up to 70 % foreign content

Airbus Guarantee

An Airbus Guarantee is a guarantee on first demand covering the risk of bad debt losses (excluding the structure risk). Normally, the contractual set-up of the covered export transaction consists of a leasing contract, an isolated financial loan granted to a special-purpose company and covered by the guarantee and a subsequent finance lease to an airline or an operating lease company (asset based financing).

The Airbus guarantee covers bad debt risks (excluding structural risk) on first demand.

Ship Financing

Ship financing requires customized cover as basis of competitive financing schemes for German shipyards and their suppliers. The flexible solutions available within the framework of Hermes Cover make cover both of new ships (e.g. passenger ships, container vessels, oil tankers and product tankers, roll-on-roll-off ferries, etc.) and, for example, the conversion of an existing ship possible.

Protection against payment default arising from in particular for long-term financing.

- Up to 12 years credit period

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