This document provides information about export credit and the Export Credit Guarantee Corporation of India (ECGC). It discusses the risks involved in export credit, defines ECGC and its role in providing credit insurance to exporters and banks in India. It outlines the functions, objectives, policies and schemes of ECGC, including key policies like contract, shipment, services and construction works policies as well as overseas investment insurance. The document aims to explain how ECGC helps exporters by offering various insurance covers and credit risk management services.

1. Export Credit
Group No: 10
Chandak Kapoor
Dheeraj Joshi
Gokul K Prasad
HariHara Prabhu
Jitender Badyal
Manjeet Poonia

2. The ability of a customer to obtain goods or services before payment,
based on the trust that payment will be made in future

3. RISK ??
A probability or threat of damage,
injury, liability, loss, or any other negative
occurrence that is caused by external or
internal vulnerabilities, and that may be
avoided through preemptive action

4. WHAT IS ECGC ?
• Government owned enterprise
• Provides credit insurance facilities to exporters and banks in
India
• Works under administrative control of Ministry of Commerce
& Industry
• Managed by a Board of Directors comprising representatives
of the Government, Reserve Bank of India, banking , insurance
and exporting community.

5. Branches

6. ECGC
• It has evolved various export credit risk insurance products to
suit the requirements of Indian exporters and commercial
banks
• The seventh largest credit insurer of the world
• Essentially an export promotion organization
• Seeking to improve the competitive capacity of Indian
exporters by giving them credit insurance covers comparable
to those available to their competitors from most other
countries
• It keeps its premium rates at the lowest level possible.

7. FUNCTIONS OF ECGC
• Provides a range of credit risk insurance covers to exporters
against loss in export of goods and services
• Offers Export Credit Insurance covers to banks and financial
institutions to enable exporters to obtain better facilities from
them
• Provides Overseas Investment Insurance to Indian companies
investing in joint ventures abroad in the form of equity or
loan

8. HOW DOES ECGC HELPS EXPORTERS
• Offers insuranceprotectionto exportersagainst payment risks
• Provides guidance in export-relatedactivities
• Makes available informationon different countrieswith it's own credit ratings
• Makes it easy to obtainexport finance from banks/financial institutions
• Assists exportersin recoveringbad debts
• Provides informationon credit-worthinessof overseasbuyers

9. VISION & MISSION
• The vision of Export Credit GuaranteeCorporation of India Ltd. Is to excel in providingexport credit
insuranceand trade related services.
• The mission of ECGC is to support the Indian Export Industry by providing cost effective insurance
and trade relatedservices to meet the growing needs of Indian export market by optimal utilizationof
availableresources.

10. OBJECTIVES OF ECGC
• To encourage and facilitate globalizationof India’s trade
• To assist Indian exporters in managingtheir credit risks by providingtimely information onworthiness
of the buyers, bankers and the countries.
• To protect the Indian exportersagainst unforeseenlosses which may arise due to failure of the buyer,
bank or problems face by the countryof the buyer by providingcost effectingcredit insurance covers.

11. OBJECTIVES OF ECGC
• To facilitateavailability of adequate bankfinance to the Indian exporters by providingsurety insurance
covers for bankers at competitiverates
• To developworld classexpertise in credit insurance amongemployeesand ensure continuous
innovation and achieve the highestcustomer satisfactionby deliveringtop qualityservices
• To educate thecustomers by continuouspublicityand effective marketing

12. RISKS COVERED
Risks Commercial
Risks
L/C Opening
Banks Risks
Political
Risks

13. POLITICAL RISKS
• Import Restrictions
• War/ civil war/ Revolution
• Additional Freight or insurance charges
• Any other cause attributable to importing country
• Insolvencyof the Buyer
• Protracteddefault of the Buyer
• Buyer’s failure to accept the goods
Commercial Risks

14. L/C OPENING BANK’S RISKS
• Insolvency of the L/C opening Bank
• Failure of the L/C opening Bank to make payment due within
a specified period
• Non – payment or non – acceptance due to discrepancies in
the L/C
• Risks of loss due to commercial or quality disputes
• Insolvency or default of any agent of the exporter or of the
collecting bank
• Exchange Rate Fluctuation
• Failure of the exporter to fulfil the terms of the
• contract or negligence on his part
Risks not Covered

15. ECGC POLICIES
Policies
Export Credit
Insurance for
Exporters
Export Credit
Insurance for Banks
Special Schemes

16. EXPORT CREDIT INSURANCE
FOR EXPORTERS
Short Term Medium and
Long Term
 Shipments Comprehensive
Risk Policy
 Small Exporters Policy
 Shipments Policy
 Services Policy
 Export Turnover Policy
 Export Specific Buyer Policy
 Consignments Export Policy
 IT – Enabled Services Policy
 Construction Work
Policy
 Letter of Credit
Confirmation Cover
 Specific Policy for
Supply Contract
 Specific Shipment
Policy
 Specific Services
Policy

17. EXPORT CREDIT
INSURANCE TO BANKS
 Packing Credit Guarantee
 Export Production Finance Guarantee
 Post – Shipment Credit Guarantee
 Export Performance Guarantee
 Export Finance (Overseas Lending)
Guarantee

18. SPECIAL SCHEMES
 Buyer’s Credit Covers
 Line of Credit Cover
 Overseas Investment Insurance

19. SOME OF THE MAIN POLICIES
• Contract Policy
• Shipment Policy
• Constructions Work Policy
• Services Policy
• Overseas Investment Insurance

20. CONTRACT POLICY
• Exporters that have secured contract for Turnkey Projects,
EPC contract or any other contract which involves supplies
of capital goods and services for commissioning of the
project
• The cover provides protection against non – receipt of
payments due to commercial and/or political risks
• Risks Covered – Political, Legal and L/C opening bank
risks
• Loss Coverage – 90%

21. OBLIGATIONS:
 Obtain indicative premium rate at bid stage.
 Seek cover after payment of premium.
 Advise progress of project in accordance with PEM guidelines.
 Declaration of overdue payments.
 Filing of claim within 12 months from due date.
 Sharing of recovery.

22. HIGHLIGHTS:
 Cover can be either for Political or Comprehensive Risks
 Pre shipment risk cover can also be obtained
 Premium in instalments
 Reduced premium for projects funded by Multi-lateral agencies

23. SHIPMENT POLICY
• Exporters that have secured contract for supply of capital goods
such as machinery or equipments on deferred terms of payment
• The cover provides protection against non – receipt of payments
due to commercial and/or political risks
• Risks Covered – Political, Legal and L/C opening bank risks
• Loss Coverage – 90%

24. SERVICES POLICY
• Covers contracts under which only services are to be
provided
• The cover offers protection to the Indian exporters against
payment risks involved in rendering services to the foreign
buyers
• A wide range of services like technical or professional,
hiring or leasing can be covered under these policies
• Risks Covered – Political, Legal and L/C opening bank risks
• Loss Coverage – 90%
• Obligations and Highlights are the same as mentioned in the previous slides

25. CONSTRUCTION WORKS
POLICY
• It is designed to provide cover to an Indian contractor who
executes a civil construction job abroad
• The cover provides protection against non-receipt of payments
due to commercial and/or political risks
• Risks Covered – Political and Legal Risks
• Loss Coverage – 85%
• Obligations and Highlights are the same as mentioned in the previous slides

26. OVERSEAS INVESTMENT
INSURANCE
• Provides cover for the investments made by Indian investor
abroad in joint ventures or in their wholly owned subsidiary in
the form of equity or untied loan
• The basic principle is that the investment should emanate from
India and benefit of dividend/interest there from should accrue
to India
• The cover provides protection against non-receipt of receivables
due to specified political risks.

27. POLITICAL RISKS COVERED –
 War, Civil War, Revolutions in buyer’s country
 Expropriation
 Restrictions on remittances
• Loss Coverage – 90%
• Obligations are same as mentioned in the previous
slides

28. HIGHLIGHTS –
• Cover for Political Risks only.
• Investments in form of cash or through export of goods and
services.
• Cover available up to 15 years
• Extendable up to 20 years with reduced insured amount.
• Reduced loss coverage with proportionate reduction in
premium.