Banking tips to get better financing for your business

• Case in point: A new international buyer approaches you with a great opportunity that could take you to the next level—and beyond.
• One catch: They want longer payment terms.
• Your dilemma: You can’t say, “No,” but saying, “Yes,” would push you into a precarious cash crunch.

You’re not alone.

Our research shows that financing is one of the biggest challenges for Canadian exporting companies, especially when expanding into new markets, or increasing their cash flow to deliver on a new contract. In fact, 68% of companies experience a gap in export financing, according to our 2026 data.

This is why many Canadian exporters turn to Export Development Canada (EDC). We work with financial institutions (FIs) by sharing risk, or providing guarantees, to help you access more working capital, or improve financing terms. In some cases, EDC can also lend directly to support international growth, especially when export opportunities exceed traditional credit limits.

EDC can help exporters understand their financing options and how to prepare for better conversations with their banks. The best approach depends on the company’s export activity, cash flow needs, buyer terms and level of risk.

We can help you access the financing you need to grow in international markets, including Europe and the rapidly growing Asia-Pacific.

If your bank has reached its limit on the working capital it can offer you, EDC can help by sharing some of the lending risk related to your exporting. This gives your FI more flexibility to lend, so you can access additional financing. We work with your bank—not in place of it.

Not sure if you’re an exporter?

If you answer, “Yes,” to any of these questions, EDC considers you an exporter.

• Are you currently selling goods or services outside of Canada?
• Do you create a good and/or service that forms part of a global supply chain?
• Do you have a plan to export goods or services in the future?

Learn more about how EDC defines “exporting” and who we can help.

How we can help your financial institution recognize your foreign assets

Most banks won’t accept foreign receivables as collateral. That’s where EDC Credit Insurance can help.

With our trade credit insurance, your bank knows that if your customer doesn’t pay, we will. This gives them the confidence to lend against up to 90% of your insured invoices, helping you access more cash.

How we can help you maximize working capital from your financial institution

It’s exciting when your company is growing and you’re getting orders from new global markets. But if your growth is too rapid, banks may be cautious—especially if a large percentage comes from outside Canada.

That’s where EDC comes in.

We partner with nearly all Canadian financial institutions to understand and fill the gap when they’re challenged to support the growth of exporters, like you. We have solutions that can increase your access to working capital by reducing your FI’s risk. With our working capital guarantees, we take on international risk, giving your FI the confidence to offer you more favourable lending options, or free up assets that they’d otherwise hold as collateral.

Amesika Baeta, regional director at EDC, says “our role is to help Canadian exporters understand the financing considerations that often come with international growth. We’re not replacing the advice of a financial institution, but we can help exporters ask better questions and prepare for more informed conversations.”

How can exporters improve cash flow while waiting for international payments?

Exporters often face cash flow pressure due to longer payment terms and delayed payments from international buyers.

“Longer payment terms can help win international business, but they can also stretch cash flow. Before agreeing to those terms, exporters should understand what costs they’ll need to carry, how long cash will be tied up and whether their current financing can support the opportunity,” says Baeta.

Guarantees or insurance can help unlock cash tied up in receivables or reduce the risk associated with foreign buyers. These approaches can help maintain liquidity and support continued growth while waiting to get paid.

Before agreeing to longer payment terms, exporters should understand:

• How much working capital will be tied up before payment is settled
• Whether supplier payments are due before customer payment
• Whether inventory, shipping, duties, or insurance costs need to be paid upfront
• Whether the contract creates foreign exchange (FX) exposure
• Whether the company has room on its existing operating line of credit

It’s important to know how FIs, including national and regional banks, credit unions and other lenders, operate in general to maximize your borrowing capacity. Some basic operating principles to keep in mind:

• The difference between being bankable and being lendable
  • All companies with financial data are bankable: You can open a business account, deposit revenue and pay your company’s bills.
  • To be considered lendable, you typically need at least three years’ worth of financial statements, plus assets, inventory, or accounts receivable as collateral. You’ll also need to have a minimum risk rating. It’s critical to know how your company performs on paper before asking your banker for additional financing.
• How financial institutions evaluate creditworthiness
  The process FIs use to evaluate creditworthiness is changing. It takes several people to evaluate any company, so bankers have moved to a more behavioural-based model to calculate credit scores. The score you’re given generally combines performance data from companies similar to yours and an analysis of your company’s history with your current FI (including borrowing and repayments, cash cycle and customer payment terms).
• Banks often aren’t able to recognize foreign assets
  Most banks are reluctant to assign value to assets located outside Canada, including any foreign accounts receivable you have. Why? If you’re unable to pay back the money you owe, it’s much harder for them to recoup their losses by claiming or liquidating collateral assets located outside Canada. That reduces the amount of financing you can get, plus limits the size and number of contracts you can take on at one time. For example, an exporter may have confirmed purchase orders or invoices from reliable international buyers, but if those receivables are outside Canada, the bank may not treat them the same way as domestic receivables. That can reduce the amount of working capital available, even when the company has strong export sales.
• Competition for loan dollars
  When you ask your bank for financing, you’re actually competing against other businesses for loan dollars. So, it’s critical that you present your case effectively and efficiently. We detail the must-haves in the next section.
• Time constraints of account managers
  Chances are, your FI account manager is juggling a large portfolio of clients, each with their own unique backgrounds, plans and needs. Providing a clear business plan and financial statements will help you achieve a positive outcome.

Now that you know how your financial institution—and banker—operate, it’s time to get your documents in order and your pitch perfected.

1. Determine your ask

This may seem obvious, but spend a little time clarifying your ask, or defining the problem that you want your FI to support. Is your objective to finance a gap between the payment of your suppliers and your customer’s payment terms? Do you need to purchase more raw materials for a new, unusually large contract? Being able to share your pain points will help your FI account manager decide which solution—loan, line of credit, or another solution—best meets your needs.

• Loans have a non-revolving credit limit, which means you have access to the funds only once and then, you make principal and interest payments until the debt is paid.
• With a line of credit, you receive a set credit limit similar to a credit card. You must make regular payments that include both principal and interest. Unlike a loan, you’ll have continuous and repeated access to the line of credit while it’s active.

2. Gather your financials

Financial institutions typically lend to companies that can provide a minimum of three years of financial statements. If your business is newer, or your future plans differ from your past performance, be ready to share financial projections to explain your plans. FIs may consider financing a specific transaction instead of offering an open-ended loan. For example, if your company is less than three years old, but has a solid foundation and needs extra cash to fill a large order.

 3. Assess your collateral

For a small business line of credit, financial institutions typically ask for $2 in collateral for every $1 they offer. You’ll need to be clear about how much collateral you can provide to back your loan or credit line. Collateral includes capital assets, inventory, or accounts receivable.

• Capital assets: These include real estate and equipment. FIs don’t generally accept capital assets as collateral because they’re harder to liquidate. But it can’t hurt to include them.
• Inventory: Financial institutions usually accept inventory as an asset at a rate of 50 cents on the dollar. Valuation will also depend on the quality of your inventory and your company’s inventory turnover. Canada is one of only a few countries that applies this borrowing practice.
• Accounts receivable: For domestic receivables with payment terms under 90 days, a bank may only give you 65 cents on the dollar and zero for receivables outside of Canada. But if you have trade credit insurance, you’ll typically get 90 cents on the dollar for both domestic and international receivables (more details below).

4. Perfect your pitch

“Export financing conversations are stronger when the company can connect the financial ask to a clear export opportunity,” says Emiliano Introcaso, senior product operations manager at EDC.

“It’s not just about saying, ‘We need more working capital.’ It’s about showing how the financing supports a specific buyer, market, payment term, or growth plan,” he says.

Bankers can’t provide working capital to every business that asks, so make sure you stand out from the crowd. Go in with a presentation—one that strikes the right balance between entrepreneurial passion and solid financials. They’ll appreciate the excitement you have for your company, but they also want to know you have a solid plan.

• Be ready to talk about why you need more working capital and tell a story about what makes your business unique.
• If there’s a certain market you want to enter, you need to be prepared to speak about the risks and opportunities in that market.
• Be ready to explain why you want to expand your business there and what long-term success looks like for your company. Exporters should be able to explain:
  • Which market they’re entering and why
  • Who the buyer is and how payment terms are structured
  • How long the cash conversion cycle will be
  • Whether foreign exchange risk could affect margins
  • What upfront costs are required before payment is received
  • How the company will manage logistics, compliance and delivery risk

5. Reduce your bank’s risk

Your bank is more likely to provide you with working capital when they know their risks are covered. They need to know they can recoup losses if you’re unable to pay back the money borrowed. EDC has financial solutions to help you do business in international markets by reducing your FI’s risk. Depending on your situation, it may offer EDC-backed solutions such as our Export Guarantee Program (EGP), which can increase your borrowing capacity or help you secure financing more quickly.