- Belgian federal government and trade credit insurers reach agreement to extend the support scheme to sustain trade
- Despite Covid-19, Belgian businesses continue to benefit from credit limits to secure their commercial transactions
- Trade credit insurers provide cover of EUR40 billion for Belgian companies
The Belgian federal government, Euler Hermes – the world leader in trade credit insurance – and three other credit insurers have jointly decided to extend their protective shield for the Belgian economy by six months until 30 June 2021. By working alongside the public authorities, Euler Hermes continues to support Belgian companies in overcoming this economic crisis of unprecedented proportions. The agreement protects businesses and their supply chains. Despite Covid-19, the guarantee program allows Euler Hermes to pursue its mission of securing business-to-business trade (B2B).
Trade credit insurance protects B2B companies against the risk of non-payment and indemnifies a policyholder in the event of an unpaid invoice by a buyer. Thanks to this support scheme, credit-insured companies will be shielded from the deterioration of companies’ credit worthiness brought about by the crisis. This in turn will substantially reduce the domino effect that payment defaults can create across the supply chain. It will also ensure that a number of buyers which experience temporary difficulties due to Covid-19 do not face an additional strain from reduction in supplier credit available to them. Both domestic and export B2B transactions of Belgian companies are covered under the support scheme.
Ed Goos, Euler Hermes BeLux CEO:
In total, trade credit insurers cover more than EUR40 billion of B2B transactions for their Belgian customers in Trade Credit Insurance, Surety and Guarantee policies. The agreement provides for a maximum guarantee from the Belgian federal government of EUR900 million to trade credit insurers until 30 June 2021. The credit insurers are making a significant contribution to the protection mechanism by providing an important part of their premium income to the State.