FAQ's

What are the objectives of the two Schemes?

  • Provide ease of access to finance for small and medium sized enterprises (SMEs) to medium and long-term credits.
  • Address the concerns of banks operating in Jordan regarding SMEs' lack of collateral and encourage credit appraisals which place greater emphasis on a borrower's/ lessee's ability to repay from cash flow rather than on the ability to provide tangible collateral. 

What is the purpose of the two Schemes?

Helping small and medium sized enterprises to get a medium and long- term credit from banks and leasing companies by encouraging them to finance these projects based on economic viability and cash flows along with JLGC guarantee

Who benefits from this program?

All existing SMEs enterprises which work in the industrial and services sector and operating in Jordan as a profit making enterprises, fully owned by the private sector with a maximum of 250 employees and minimum of 5 employees.

What are the purposes accepted for guarantee?

  • Loans may only be approved for the purchase, renovation or extension of premises, finance the purchase of machinery and equipment, working capital, up to 15% of operating expenses  related to the project for which the loan is sought.
  • Working capital may constitute up to 25% of total project costs, however, if working capital exceeds 10% of total project cost, the re-payment term set for the loan must reflect the shorter-term nature of working capital financing.

What is the purpose accepted for guarantee with respect to revolving loans?

For the purpose of letters of credit to import raw materials for manufacturing purposes or/and the financing of local purchases of materials used for manufacturing targeting the sectors that are eligible for JLGC guarantee.

What is the excluded Activities?

The following types of loans that are not eligible  for  JLGC guarantee:

  • Primary agricultural production.  Food processing activities are eligible
  • Banking, insurance, financial services
  • Loans granted to finance existing credit portfolios of financial institutions or to guarantee the renewal or extension thereof.  
  • Tobacco and tobacco related products
  • Alcoholic products and beverages>
  • Manufacturing or selling munitions articles or services

How to apply:
Industrial finance Guarantee & Financial Leasing Guarantee - EJADA
Step 1
If you are a small or medium-sized company (industrial, productivity) and you need to get credits
(Medium or long-term loan) for financing  the purchasing of fixed assets or to make renovation or extension of premises, clarify  the purpose of the loan, provide a feasibility study, financial statements  for two consecutive years for  the project to be ready as an initial step.
Step 2
Since all JLGC Loan guarantee applications must be submitted through the Participating banks, review the list of Participating Banks to make sure that your bank has an active relationship with JLGC, then apply your application through your bank who should first check that your application meets the criteria of the schemes
Step 3
If an application meets the eligibility criteria and the PB is satisfied that the loan applicant has the ability to repay from cash flow, the PB  should seek a guarantee approval from JLGC by forwarding the completed documentations to JLGC.
Step 4
If the guarantee is acceptable by JLGC and there is an acceptance by the bank of the guarantee conditions, the applicant shall proceed with the PB to complete the required procedures, such as signing of contracts.

What is Export Credit Guarantee?

Export Credit guarantee is an incentive for the encouragement and development of exports by providing insurance coverage to Jordanian exporters against risks of non-receipt of exports value by its due date in the case of exporting commodities and services in terms of credit sales on different time periods, the policy covers 90% of losses resulted from commercial and non-commercial risks.

What are the risks covered by the Jordanian export credit guarantee scheme?

The Jordanian export credit guarantee scheme covers the following commercial and non-commercial risks:

  • Commercial Risks:
    Buyer’s insolvency, bankruptcy of the buyer, and refusal to receive the shipped goods.
  • Non-commercial risks:
    Government restrictions on currency conversion, any government decisions that prevent entry of the goods, and wars or civil wars or revolutions and coups.

What are the benefits provided by the program?

The exporter will be able to increase their exports to the countries they work with by offering payment facilities to face competition among exporters in different countries without the need to open LC.’s

The exporter can also benefit from our loss payee program that will cover the amount of their guaranteed shipments at one of the local commercial banks in order to obtain the value.

In the event of any risk arising from the risks covered by the policy, 90% of the guaranteed export shipments will be compensated.

What is the maximum credit limit?

Credit Guarantee Program
Max Credit Limit in USDGuaranteed percentage (%)Max. Payment Period (Month)
Export Credit Guarantees
7,500,000
90%
6 months

What is the Premium rate for JLGC export credit guarantee?

In exchange of the guarantee, the exporter will pay a premium rate that will be determined before signing the contract.

In the case that the importer or the local buyers want to postpone the payment, what procedure is applied?

If the buyer wasn’t able to pay the payment on the due date and requested an extension, the policyholder must inform us in order to get an approval.

Why does the exporter need export credit guarantee despite having full commercial insurance?

Commercial insurance provided by insurance companies protects the exporters against tangible physical risks that may affect exported goods, such as damage, theft, loss, drowning and other tangible risks. While the export credit guarantee covers the risk that the exporter will not receive the payment on the due date.

How can the export credit contract help the secured party to obtain funding?

The export credit guarantee enables the covered party to obtain financing with more favorable conditions by discounting commercial papers while assigning the rights of compensation to the bank without recourse to the covered party in case any covered is realized.

What is Domestic Credit Insurance Programme ?

The program is a guarantee to the manufacturer that the cause of their sale to the domestic buyer will be received. The program covers 80% of the losses.

**Meaning of buyer: every buyer from the private sector, including those who have legal personality such as induvial corporations and private companies. It does not include individuals and the final consumer.

What are the benefits for the Jordanian traders?

  • Enables the domestic manufacturer/merchant to raise their sales by forward sailing to provide a competitive advantage in the market, without having to pay in advance or to open a documentary credit.
  • Encourages traders to access new local markets.
  • In the case of loss, the program covers 80% of the sales value

What is the maximum credit limit?

Credit Guarantee Program
Max Credit Limit in USDGuaranteed percentage (%)Max. Payment Period (Month)
Domestic Credit Guarantees
4,000,000
80%
4-6 months

What are the risks covered?

  • Commercial risks:
    Buyer’s insolvency, bankruptcy of the buyer, and refusal to receive the shipped goods