Use of export insurance in sales by SME exporters in Colombia and Uruguay

Abstract

The main purpose of this study was to analyze the impact of export insurance on the sales of Colombian and Uruguayan SMEs, using a qualitative approach and a review of literature indexed in various databases such as Scopus, ProQuest, SciELO, Redib, Dialnet, and EBSCO. The findings indicate that the global landscape of Export Credit Insurance and the insurers offering this service suggests that multinational corporations control more than 80% of the market, given that they compete in Colombia and Uruguay through subsidiaries. Therefore, export credit insurance contracts in both countries are geared towards benefiting small and medium-sized enterprises seeking to expand their businesses, particularly to increase their production volumes by generating immediate liquidity that traditional financing methods, such as public and/or private banks, cannot provide due to their high interest rates. Furthermore, the implementation of credit insurance for exporting companies can positively influence Uruguay's balance of payments by boosting exports and increasing foreign exchange inflows, but it can also have a negative impact by increasing export costs and reducing the competitiveness of products in the international market.