Loans at market interest rates are available from commercial banks to finance the manufacture of exports including the imports of raw materials and components for export products. Loan terms vary depending upon the raw material requirements, cost of conversion and collection timeframe. In many cases, including the purchase of agricultural commodities, payments are made without any recourse to financing. However, as there are always exceptions to the rule, U.S. businesses should take common precautionary measures when doing business in Israel. This practice is appropriate and recommended when there is no past relationship and experience with the buyer.
Payment schedules vary.
For raw materials, components and semi-finished goods, credit is usually limited to 60 days. For equipment and machinery more extended schedules range from six months to two years. The local banking system provides sources of short and long-term credit and access to venture capital. The ExIm Bank has most of the leading Israeli banks as correspondents and may supplement private sources of export financing with medium and long-term loans. The ExIm Bank can also provide Israeli buyers with fixed-rate financing for their purchases from U.S. exporters.