The CBRT regularly conducts analyses to ensure the efficient use of rediscount credits provided to exporters. This blog post outlines recent changes in rediscount credit utilization and introduces the exporter scoring that will come into effect on January 13, 2025.
In recent years, significant changes have been made to the general framework of rediscount credits, aiming to enhance their effectiveness, further improve the current account balance, and make these credits available to a larger number of SMEs at affordable costs.[1] With the changes made in 2021, being a net exporter became the main condition for the selection of borrowers. Additionally, the daily limits for rediscount credits were gradually raised, easing access to financing. As a result, the number of rediscount credit beneficiaries increased from approximately 2,100 in December 2018 to about 8,000 in October 2024. The share of SMEs within firms carrying rediscount credit balances rose from 38% to 84% over this period (Chart 1).
As part of the CBRT’s ongoing efforts, a new exporter scoring is stepping in, with the aim of allocating limited resources more effectively and efficiently. The new scoring takes into account not only the net exporter condition but also other factors like the quality of products, value-added exports, export performance, and group affiliations.
The criteria and their respective weights used to calculate the exporter score of interest are outlined in Table 1. Banks calculate the score for each firm applying for rediscount credits, based on data provided by the firms themselves. First, a score is assigned to each variable in Table 1, based on thresholds set by the CBRT. Next, the “performance” and “potential” scores are computed by multiplying the points for each variable by its corresponding weight. Firms that get 40 points or more in either score are classified as having a “high exporter score”. Those that get less than 40 points in both scores are considered to have a “low exporter score”.[2]
Using the CBRT data on firms and the method summarized in Table 1, we calculate the performance and potential scores of goods-exporting firms. The results show that “net exporter” firms not only have higher performance scores but also significantly higher potential scores compared to “net importer” firms (Chart 2).[3] This distinction underpins the objective of the new exporter scoring, which aims to ensure that exporters with high potential make larger use of rediscount credits than net importers with low potential. However, even net importer firms with high value-added export potential can access rediscount credits.
We also classify firms with a rediscount credit balance into two groups based on their scores: “firms with a high exporter score” and “firms with a low exporter score”. Our analysis reveals that high-score firms using rediscount credits account for 23% of total exports, while low-score firms account for less than 2% (Chart 3). Additionally, 41.5% of high-score firms’ exports are medium-high-tech products, compared to just 2.7% for low-score firms. Moreover, while low-score firms are generally net importers, high-score firms tend to be net exporters.
To sum up, the efficient utilization of rediscount credits— an advantageous source of financing compared to market conditions— is of utmost importance for the efficient and effective allocation of financing resources. With this new implementation, the CBRT continues to primarily support net exporter firms, while also prioritizing high-tech firms.
[1] As per the implementation instructions that took effect on October 1, 2021, the CBRT raised the program limit for rediscount credits to USD 30 billion and sought net exporter condition for eligibility. The latest change on October 8, 2024 raised the daily limit for rediscount credits to TRY 4 billion and announced that the condition of being a net exporter to make use of rediscount credits would be replaced by a model based on the scoring of firms, which takes into account broader inclusion, positive contribution to the current account balance and value-added exports. For other regulatory amendments, see the implementation instructions revised on (1) September 17, 2021, (2) July 25, 2023, (3) September 12, 2023, and (4) October 8, 2024.
[2] Except for the conditions listed in paragraph 4 of Article 6 of the implementation instructions, firms that will use rediscount credits through banks other than Türk Eximbank should get 40 points or more from at least one of the performance or potential scores used in the calculation of the exporter score, However, the exporter score of the manufacturer or manufacturer-export companies that provide final goods for exports to the intermediary export firm whose exporter score is above the specified threshold is also deemed to be above the specified threshold. All responsibility for determining the accuracy of the data declared by firms belongs to intermediary banks.
[3] For group firms, net exports of the business group have been taken into account.