When your business is bleeding cash from tariffs that may have been illegally imposed, waiting for the government to cut you a check isn't always an option. So American companies are getting creative — and expensive.

Businesses hit hardest by the ongoing tariff turbulence are now pledging their expected government refunds as collateral to secure loans, according to multiple reports. It's a desperation move that underscores just how badly trade policy whiplash has strained corporate balance sheets.

"People are trying to be creative," one financial advisor told Fortune, describing the emerging market for tariff-backed financing. Translation: companies are so starved for working capital that they're willing to pay interest on money the government arguably owes them already.

The Refund Bottleneck

The U.S. Customs and Border Protection agency announced that its tariff refund portal will go live on April 20, according to Bloomberg. That's the official channel for businesses to reclaim duties paid on imports that were later deemed improperly assessed or subject to exemptions.

But here's the problem. Even when the portal launches, refunds won't arrive overnight. The claims process involves documentation, review periods, and bureaucratic processing that can stretch for months. Meanwhile, companies that paid tariffs upfront — often running into six or seven figures — are operating with that cash locked away.

For businesses with tight margins or seasonal inventory cycles, that's not just inconvenient. It's potentially fatal.

Who Pays, Who Waits

The refund mechanism highlights a fundamental inequity in how tariff costs flow through the economy. Corporations that import goods pay the duties at the border. They can file for refunds if those tariffs are later reduced, exempted, or ruled invalid. Consumers who bought tariff-inflated products? They're out of luck.

As Truthout reported, tariff refunds flow to companies while consumers keep footing the bill. That $248 coat a shopper bought — inflated by what turned out to be illegal levies — won't generate a rebate check in the mail. The importer might recoup their costs eventually, but the price you paid at checkout is permanent.

This creates a strange dynamic where businesses become creditors to the government, waiting to collect on debts that arose from policy uncertainty. And where there are debts, there are lenders willing to advance cash — for a price.

The Legal Minefield

Adding another layer of complexity, some companies aren't just waiting for routine refunds. They're preparing for litigation.

According to Law360, attorneys are now calculating potential damages in lawsuits challenging tariffs imposed under the International Emergency Economic Powers Act (IEEPA). These cases argue that certain tariff actions exceeded presidential authority or violated procedural requirements.

If those challenges succeed, the refunds could be substantial. But litigation takes years, not months. For a mid-sized manufacturer that paid $2 million in disputed duties, the choice becomes: wait for your day in court, or pledge that potential judgment as collateral and get 70 cents on the dollar today.

Neither option is good. Both are expensive. And both exist because trade policy has become so volatile that businesses can't plan inventory or pricing more than a quarter ahead.

The Human Cost

A BBC report illustrated the consumer side with a stark example: a shopper who paid $248 for a coat, with a significant portion of that price attributable to tariffs later deemed illegal. The question posed — "Will he ever get the money back?" — has an obvious answer: almost certainly not.

Retailers don't track which specific tariff costs went into which products. Even if they did, the administrative burden of issuing retroactive refunds to individual customers would be prohibitive. The result is a one-way transfer: consumers overpay, importers eventually get refunds, and the price distortion becomes permanent for everyone who bought during the tariff window.

This isn't an accident of policy design. It's a feature. Tariffs are blunt instruments, and their costs diffuse through supply chains in ways that are nearly impossible to reverse once products reach end users.

What Happens Next

The April 20 portal launch will provide some relief, but it won't solve the underlying problem. As long as tariff policy remains unpredictable — subject to sudden announcements, exemptions, and legal challenges — businesses will continue facing these cash flow crunches.

The emergence of a secondary market for tariff refund claims is a symptom of that dysfunction. When companies would rather pay a lender's interest rate than wait for the government to process their paperwork, you know the system isn't working.

For now, the "creative" solution of collateralizing refund claims will likely spread. Specialty lenders are already circling, offering to advance funds against expected customs rebates. It's a rational response to irrational policy.

But rationality doesn't make it any less absurd that American companies are paying to access their own money — money they only parted with because trade rules changed faster than they could adjust their supply chains.

The refund portal might process claims efficiently. The litigation might clarify legal boundaries. But until tariff policy stabilizes, businesses will keep finding expensive ways to survive the chaos. And consumers will keep paying prices that reflect costs their government later admits shouldn't have existed in the first place.