Support The Progress Of The UKM Business, LPEI Protects Export Products With Insurance

Illustration (Photo: Doc. Ministry of Finance)

JAKARTA - The Indonesian Export Financing Agency (LPEI) or Indonesia Eximbank is said to provide Trade Credit Insurance insurance facilities for exported SME products.

LPEI's Director of Business Development Maqin U. Norhadi said this was a commitment to protect a sense of security to Indonesian exporters in carrying out trade activities abroad.

"Through Trade Credit Insurance, LPEI provides compensation to Indonesian exporters for possible loss risks due to non-acceptable payments from buyers or openers L/C due to commercial risks and the country's political risks of buyers," he said in an official statement on Wednesday, November 30.

According to Maqin, the risk of loss can be caused by commercial risks where buyers experience cash flow difficulties and/or political risks due to political turmoil in the buyer country so that invoice payments are stuck or not paid at all.

"This insurance facility is expected to increase confidence in carrying out export activities, implement risk management, expand to international markets, and increase competitiveness at a very competitive global level," he said.

For information, in 2021 LPEI has reached an outstanding coverage value of IDR 10.9 trillion, an increase of 34.5 percent from the 2020 period.

Meanwhile, the LPEI Trade Credit Insurance in the 2021 period has contributed to supporting Indonesia's export activities by providing protection for export transactions to 637 buyers spread across 73 countries, including Japan, the United States, Singapore, China, Thailand. Then, Malaysia, Australia, Germany, Bahrain, Kuwait, Spain, Pakistan, Nigeria, Senegal, Cameroon, Ivory Coast, to Egypt.

"During the pandemic until now, LPEI has remained consistent in providing protection to the most responsible existing from various sectors in an effort to maintain the mandate to increase national exports," he stressed.

Maqin added that his party, LPEI, will continue to provide insurance awareness on the benefits of LPEI's export insurance in order to mitigate the risk of export transactions carried out by SMEs.

In addition, other benefits are emphasized, namely increasing the level of banking confidence so as to make SMEs bankable in order to obtain financing facilities.

"We hope that with LPEI's export insurance products, SMEs can penetrate the new market and are more comfortable transacting with buyers," he concluded.