Covid-19 crisis: Euler Hermes supports Dutch entrepreneurs

Read in this article how this package supports, among other things, employment within the Dutch business community.

Euler Hermes Netherlands, together with the government and other credit insurers, has put together a support scheme to sustain Dutch companies in the corona crisis. The support mechanism includes a guarantee scheme whereby the State will act as guarantor for outstanding and future supplier credits. This enables credit insurers to secure business-to-business (B2B) commercial transactions, continue to support business and expand their support for the Dutch economy. In addition, an important starting point of this scheme is supporting employment within the business community.

Thanks to this support scheme, trade credit insurance underwriters will be able to maintain credit lines as much as possible to Dutch companies, allowing them to continue to pursue commercial transactions without non-payment risk.

Credit insurance covers B2B companies against the risk of non-payment and indemnifies a policyholder in case a debtor is unable to meet a trade receivable. The difficulties of some companies could quickly affect suppliers, and cause a domino effect in entire supply chains. The current situation requires increased vigilance on the part of the credit insurers, as well as the joint commitment of the entire public and private financial ecosystem. In total, credit insurers cover more than EUR 200 billion in B2B commercial transactions for their Dutch customers through credit insurance policies.

Mike de Bresser, CEO of Euler Hermes Netherlands: “Credit insurance plays a key role in our economy; we ensure that suppliers can trust that outstanding bills will be paid. We function as a lubricating oil for transactions and deliveries. Euler Hermes works closely with the government to guide and support Dutch entrepreneurs as best as possible. More and more companies - even those who were in good financial health before the crisis - are facing liquidity problems today due to unpaid invoices from their customers. Thanks to the new support scheme, we can continue to cover certain risks and protect our customers.”

Specifically, the guarantee program enables credit insurers to maintain as many credit limits as possible for their Dutch policyholders. The agreement provides for a maximum government guarantee of 12 billion euros to the credit insurers from 1 January 2020 to the end of the year. To cover the commercial transactions between Dutch companies and their debtors in the Netherlands and abroad. With this, credit insurers retain their important role as liquidity protectors for Dutch companies.

“Thanks to this guarantee, the government supports Dutch entrepreneurs. The support mechanism aims to protect companies that were in good financial health before the crisis and to maintain trade despite this particularly difficult period,” says Mike de Bresser. “Although we work remotely during this period, we continue to help Dutch companies and provide them with consistent, high-quality services. Despite the picture of negative developments within the economy and different sectors, and the significant increase in risks, our experts continue to carefully analyze the financial stability and risk profile of companies.”

Euler Hermes Netherlands introduced several measures at the end of March to support its customers.