The KUKE has prepared a new guarantee system for financing the energy transition

The Polish export support agency KUKE has prepared a new system of loan guarantees for companies that want to carry out the energy transition, chairman Janusz Władyczak told ISBnews. It includes, among other things, a departure from the export requirement.

“We have prepared a new guarantee system for energy transition financing. It’s a solution aimed at a fairly wide audience, and we are moving away from the requirement for any exports. We want to help all entrepreneurs who want to make such a transformation.” – Vladyczak said in an interview with ISBnews during Banking & Insurance Forum 2023.

“We are at the stage that we have products approved internally. We don’t want to invent anything new, we are modeling on what is already on the market so that it will be easier for both banks and entrepreneurs to use these instruments.” – He added.

He stressed that the energy transition requires multibillion-dollar investments, and the guarantee system will free up more funds.

“As we hear, the banking sector wants to finance the transition, but these funds are not quite there, so they need to be carved out. And the guarantee system is the best instrument that can be used to make this money happen. We are talking about loans for 6-7 years, but also much longer. Because if we are talking about financing nuclear power plants, offshore power plants – these are tens of billions; you need long money, even twenty years, and this is very difficult to obtain from the market,” the KUKE president said.

He informed that the Export Credit Insurance Corporation is applying for notification of these instruments by the European Commission.

“We hope that the EC will look favorably on our initiative and we will be able to launch these instruments next year,” he announced.

“This will not be state aid. These are normal instruments, where we cover 80% of the loan with a guarantee, the bank is at its own risk, we are not pulling all the risk from either the entrepreneurs or the bank. It’s important that all players feel the risk of these projects, and they are risky, despite appearances,” he stressed.

The Export Credit Insurance Corporation has been insuring trade transactions of Polish entrepreneurs for more than 30 years. It offers services to ensure safe trade both at home and abroad. As the only institution in the country, KUKE offers products with Treasury guarantees and insures long-term investment export projects.

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