Next Challenge: Lending on Foreign Receivables

Although Jim Mayer spent much of 1994 trying to build greater acceptance of asset-based lending in the United States, the future of his company may lie abroad.

The president and CEO of Diversicorp is now promoting asset-based lending supported by foreign receivables.

"The idea of commercial finance with developed nations has been one that's been on my mind and needed by these businesses but one that banks and finance companies have not been able to provide," he said.

Though both parties may be considered strong domestic credits, distance and culture can create problems for companies seeking to secure this type of financing. Because the companies are trading overseas, bankers and regulators require credit enhancements from such agencies as the Export- Import Bank.

Mr. Mayer wants to guide companies and their lenders in underwriting the pledge to build collateral control that matches the risk. In doing that, and supporting it with professional liability coverage, he said, the company is beginning to get lenders to look at financing assets without the credit enhancement.

But given the slow response of small-business lenders to plain-vanilla arrangements domestically, Diversicorp's foreign venture may be decidedly long-term.