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Chancellor Rachel Reeves has announced a joint export finance scheme between UK Export Finance (UKEF) and the British Business Bank, aimed at smaller businesses that struggle to access the working capital they need to export. The scheme is set to launch in spring 2027 and is targeted at the estimated thousands of SMEs with export ambitions that commercial lenders currently underserve.
The announcement came on 12 July 2026, alongside the publication of UKEF's Impact Report for 2025-26 which showed the department provided over £11 billion in financing last year, supporting up to 85,000 jobs and contributing up to £6.4 billion to GDP.
Key Facts at a Glance
- Launch date: Spring 2027
- Who runs it: UKEF provides the portfolio guarantee, the British Business Bank assesses, onboards, and manages lenders
- Who can apply: SMEs across all sectors with export ambitions
- What's supported: Term loans and working capital facilities, including lower value loans
- UKEF's current scale: £130 billion of financing capacity, over £11 billion deployed in 2025-26
The structure is a portfolio guarantee, a model already used in the SME lending market adapted specifically for smaller exporters. UKEF will guarantee a portion of eligible portfolio level losses, while participating commercial lenders retain a share of risk. The British Business Bank takes on responsibility for assessing which lenders can join, onboarding them, and managing the scheme from day to day.
The new joint scheme builds on steps UKEF has already taken to bring more lenders into the export finance market. During 2025-26 it added non-bank lenders White Oak, Nighthawk, and more recently Mercore to its network. In January 2026, it also secured an £11 billion joint lending commitment from the UK's five major banks described as one of the largest collective sector moves in over a decade.
- White Oak and Nighthawk: Added during 2025-26 as non-bank lending partners
- Mercore: Added in the weeks leading up to the July announcement
- Five major banks: £11 billion joint commitment mobilised in January 2026 specifically to increase access for smaller exporters
- Case examples: UKEF supported Yorkshire brewery Wold Top, which secured a £200,000 trade loan via Virgin Money to grow exports to Europe and North America
- Global reach: Dulas, a Welsh renewable energy firm, used successive UKEF backed finance packages to deliver solar vaccine refrigeration to programmes across more than 80 countries
The announcement drew statements from the Business Secretary, both institutions' chief executives, and trade bodies, each emphasising different aspects of the scheme's rationale.
Government and UKEF
- Peter Kyle (Business Secretary): Said the scheme would help smaller businesses "break into overseas markets, win new customers and turn local success into global growth"
- Tim Reid (UKEF CEO): Called it "a significant step" towards furthering UKEF's mission, saying the combination of access to finance and digital services "can support a new generation of exporters"
- UKEF mandate: The department exists to ensure "no viable UK export fails for lack of finance or insurance from the private market"
- Taxpayer position: UKEF operates at no net cost to the taxpayer
British Business Bank and Trade Bodies
- Louis Taylor (BBB CEO): Said the scheme "has the potential to transform UK economic performance and competitiveness on the global stage"
- Marco Forgione (CIET): Called access to trade finance "one of the biggest barriers facing exporters" and said the scheme would help businesses "seize international opportunities and build resilience"
- Geoff de Mowbray (BExA): Described UKEF's impact as showing "why backing UK exporters matters not only to win business, but to build long term relationships, supply chains and resilience"
- No volume target: No specific lending target or loan volume figure was announced alongside the scheme
Alongside the joint scheme, plans to bring forward legislation to modernise UKEF's mandate were set out in Parliament on 9 July. The proposed new laws would give UKEF powers to strengthen economic resilience, secure critical supply chains, and drive growth, described as transforming it into "a more powerful and flexible instrument for UK prosperity." No bill has yet been published.
- Objective: Modernise UKEF's statutory mandate beyond its current export finance remit
- Scope: Powers to address economic resilience and critical supply chain security
- Status: Plans announced, legislation not yet published
- Current capacity: £130 billion available to support UK exporters
- Sectoral alignment: Advanced manufacturing, defence, sustainable energy, and critical minerals are cited as priority areas
Relevant Policy Context
- Growth Mission: The government's overarching economic framework, to which UKEF's annual targets are formally aligned
- Industrial Strategy: UKEF explicitly links its financing priorities, advanced manufacturing, defence, clean energy, critical minerals to Industrial Strategy sectors
- Market failure logic: The scheme is premised on lenders not serving smaller exporters at commercial rates without public support, a recognised and documented gap
- Institutional collaboration: UKEF and the British Business Bank already operate across overlapping SME finance markets, the joint scheme formalises that coordination for exporters
- Precedent: The portfolio guarantee model is established in domestic SME lending, the British Business Bank already runs similar structures for non-export loans
Several details remain to be confirmed ahead of the spring 2027 launch.
- Loan size limits: No minimum or maximum loan value has been set out
- Guarantee percentage: The proportion of portfolio losses UKEF will cover has not been disclosed
- Lender pipeline: Which lenders have been approached or committed to participate has not been announced
- Application process: How businesses will access the scheme, whether directly or through their bank is not yet confirmed
- Volume targets: No headline figure for how many businesses or how much lending the scheme aims to support has been set
The joint scheme represents a structural attempt to solve a persistent problem: smaller businesses with genuine export potential can't always get the working capital to act on it.
By combining UKEF's guarantee capacity with the British Business Bank's lender network and operational experience, the government is applying an established model, the portfolio guarantee to a specific market segment that has historically fallen short. The numbers from the 2025-26 Impact Report show there is real scale in UKEF's existing activity. The question is how much the new scheme extends that reach to businesses not already being served.
The detail that will determine the scheme's impact, loan size parameters, participating lenders, guarantee levels is still to come. The spring 2027 launch timeline gives time for those to be worked through, but businesses and trade bodies will be watching closely for confirmation.
Key Takeaways
- A joint UKEF and British Business Bank export finance scheme was announced 12 July 2026, launching spring 2027
- UKEF provides a portfolio guarantee on losses, the British Business Bank manages lender participation
- The scheme targets SMEs across all sectors seeking working capital or term loans to support exports
- UKEF deployed over £11 billion in financing in 2025-26, supporting up to 85,000 UK jobs
- Key operational details, loan limits, guarantee percentages, participating lenders have not yet been published