Definition:

A new program provided by the Jordan Loan Guarantee corporation that aims to encourage and provide protection for the Jordanian exporter, by offering guarantees against any commercial and non-commercial risk of non-payment by the importer for the exported goods, in addition to facilitating the appropriate financing for the client’s activity where the insurance policy is considered as a guarantee tool.

Beneficiaries:

The Companies and institutions that have export activity in exchange for cash sales that are not covered by letter of documentary credits.

Guarantee fees:

0.4% - 1.5%, determined by the Jordan Loan Guarantee Corporation based on the risk assessment and the volume of sales of the guarantee applicant.

Shipment Amount

Maximum Shipment Amount of USD30 Million.

 Coverage rate:

90 %Coverage rate of the guaranteed exported shipments value.

Payment period:

Payment period is up to 6 months. 

Risks covered: 

Commercial risks, such as: Non-payment by the buyer, insolvency of the buyer, and the refusal the buyer to accept the shipped goods

Non-commercial risks, such as: Government restrictions on currency conversion, any government decisions & regulations that prevent entry of goods, and wars and civil disturbance.

Applying for Export Credit Guarantee Policy:

• First: The client (the insurance applicant) submits a request to the Jordan Loan Guarantee Corporation to guarantee for his sales to foreign markets.
• The application is then studied by the company; If approved, the insurance policy is signed where registration fee, inquiry fee, and guarantee fee are agreed (paid from the client to the company).

 Bank financing for the value of the insurance policy:

• Second: The customer applies to the bank for obtaining facilities to finance his export activity, in exchange of leasing the insurance policy for the favor of the bank.
• The client’s request is then studied according to the bank’s procedures, and facilities are granted through renewable or decreasing loans according to the client’s financing needs.
• If the client is unable to pay as a result of not collecting the price of the goods, and the payment date of facility is due, the bank will demand compensation from the Jordan Loan Guarantee Corporation where the claim is paid within five months from the date of submitting the claim, and according to the guarantee percentage.