For exporters, adverse movements in exchange rates are an inherent risk of doing business in international markets. For example, if you pay your suppliers in Australian dollars but receive payment for your exports in US dollars, unfavourable shifts in the exchange rate of the currencies may affect your profit margin.

A foreign exchange facility can help you protect your export profits from exchange rate fluctuations by locking in exchange rates and allowing you to hedge your currency exposure. The more of your export contracts you can hedge, the greater your control over foreign exchange risk.

With a foreign exchange facility guarantee from EFIC, Travelex can increase the trading limit on your foreign exchange facility. This means you can extend your hedging program to more of your export contracts and better protect your export profits.

Generally, you don’t need to provide security for a foreign exchange facility guarantee from EFIC. This can help to free up your working capital to take on further export contracts.

What are the benefits?

• Hedge more of your export contracts which can help to better protect your export profits
• In most cases, EFIC does not require security for the guarantee, which can help to free up your working capital
• No additional fee is payable by you for the guarantee.

How does the foreign exchange facility guarantee work?

1. You have or have approval for a Travelex foreign exchange facility
2. You request from Travelex an EFIC foreign exchange facility guarantee to increase the trading limit on your facility
3. If EFIC approves the application, it provides a foreign exchange facility guarantee to Travelex
4. Travelex increases your trading limit, enabling you to hedge more of your export contracts.

Terms and conditions

Terms and conditions are subject to negotiation. The following guidelines are typical requirements.

Eligibility
You should be an Australian exporter and:

• have or have approval for a Travelex foreign exchange facility which relates to foreign exchange forward contracts (and, for eligible customers, option contracts) for hedging purposes only
• in the last 12 months, have exported goods or services to at least the value of the foreign exchange facility guarantee.

Amount
For Travelex customers who have provided certain financial information to Travelex, the guarantee can facilitate an additional trading limit of up to $2.5 million

For other Travelex customers, the guarantee can facilitate an additional trading limit of up to $500,000.

Term
The term of the foreign exchange facility guarantee may be up to 12 months.

Fees & charges
You pay no additional fees or charges to obtain a foreign exchange facility guarantee.

Security
Generally, EFIC  does not require additional security  from you for the foreign exchange facility guarantee that it provides to Travelex.

Only available to Travelex customers who have or have approval for a foreign exchange facility. To find out how to increase the trading limit on your Travelex foreign exchange facility, contact Travelex on 1800 730 400 or enquiry@travelex.com.au.

NOTE: Information on terms and conditions is supplied as a guideline only. EFIC’s compliance with legislation and OECD guidelines, together with its credit assessment and other policies, influence the actual terms and conditions that may be applicable to any eventual transaction with EFIC.

The information provided does not comprise advice or a recommendation and EFIC makes no representation or warranty relating to it. To the maximum extent permitted by law, EFIC will not be liable for any direct or indirect loss or damage incurred by any person on the basis of this information.