Euler Hermes Designs Trade Credit Insurance For SMEs

Euler Hermes provides credit insurance for the messy world of supply chain finance, an area of high-risk exposure for many businesses, especially when doing business with overseas partners.

In its latest move, Euler Hermes is rolling out a new trade credit insurance program, Simplicity, directly for small and medium-sized enterprises based in the U.S.

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The new solution, announced Wednesday (Feb. 3), is reportedly the first trade credit insurance product specifically for SMEs, Euler Hermes said. Simplicity was developed for companies with between $1 million and $5 million in annual sales and for those that are unfamiliar with credit insurance.

Simplicity “provides a short, clear policy, transparent coverage on all buyers within just one day and fixed pricing,” Euler Hermes said in its announcement.

Trade credit insurance protects SMEs that provide credit to their overseas buyers; but due to various factors, including the risk of working with unfamiliar companies and cross-border payments issues, providing that credit can be risky if a buyer does not ultimately pay.

In a statement, Euler Hermes Americas President and CEO James Daly pointed to recent research that found up to 82 percent of business failures are a result of cash management. Trade credit management and protection can help safeguard and support cash management, especially for SMEs, he said.

“With Simplicity, small business owners can safely extend credit to domestic and international customers knowing there will be minimized impact to cash flow as a result of non-payment events,” the executive stated.

Last year, Euler Hermes announced a collaboration with Global Supply Chain Finance, a move that sees Euler Hermes act as the primary insurer for GSCF’s supply chain financing products and links existing corporate clients to GSCF’s solutions of accounts receivable and accounts payable financing.