Ecgc Overview
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Transcript of Ecgc Overview
Overview of Export Credit
Guarantee Corporation (ECGC)
BUSINESS ASPECTS IN BANKING AND INSURANCE
Group Members
Shashank Agarwal (2)
Harsh Aladia (4)
Roven Dsouza (27)
Jash Gada (29)
Saloni Jain (37)
Mili Madani (51)
Concept behind creating ECGC
Boost export promotion by covering the risk of exporting on credit.
Acts as a protection against loss
Shift focus on business related activities rather than payment issues.
Role of ECGCTo promote exports mainly by
• Protecting Exporters against commercial and political risks in realizing export proceeds
• Protecting Banks against Risks of Default in export credit • Protecting Investors against Political risks in Shareholders’ equity and loan in overseas investments
Specific Functions of ECGc1. Insurance coverage for those exporters who are entering in international trade for the first time after
economic liberalizations.
2. First- hand information in export-realted activities, particularly in areas of potentail risk associated with countries and mode of payment in globally changing trade regime and offer such guidance to exporters.
3. Through its network with other credit risk agencies in the world, it publishes information on risk perception on different countries with its own credit ratings
4. Facilitator in obtaining export finance from banks and financial institutions through various guarantees
5. Helps in recovery of bad debts from defaulters by helping them precede legal and diplomatic channels.
6. Database of exporters and and importers and shares creditworthiness.
7. Customized products to exporters.
How is it helpful for the exporters? Helps in expansion of sales
Protects exporter against bad debts.
Credit facilitation and boost borrowing power
Stabilize and assure cash flow.
Explore and develop new markets.
Protection againts corporate insolvency, bankruptcy.
Helps in dealing with concerned country’s courts and administration of recovery order.
Attributes towards success
5 Regional Offices and 51 Branch Offices
All Branches ISO 9001:2000 certified
Member of Berne Union(53 members from 42 countries)
MOU with GOI
Authorized capital of Rs. 1000 crores and paid-up Rs. 900 crores.
Alliance with Coface (France), D&B
Registred with IRDA
Accredited with “iAAA” by ICRA
GOI instilled confidence by estblishing NEIA(National Export Insurance Account) with corpus of Rs. 2000 crores.
Tie-up with NSIC (National Small Industries Corporation)
Fulll-fledged Factoring services.
Bancassurance
Two pillars of Credit Insurance
Buyer Underwriting
that assesses buyer risks
Limit fixed on Buyer
Country Underwriting that assesses country risks
Country classification
Risks covered
Buyer risks
Bank risks
Commercial risks
Political risks
Buyer Risks Bank Risks
Insolvency
Protracted Default
Contract Repudiation
Insolvency of the bank
Protected Default
War, Civil war,
Internal disturbance
sExchang
e transfer blockages/delay
New import restrictions,
cancellation of import license, etc.
New import restrictions,
cancellation of import license, etc.
Political Risks
Diversion of voyage due to war
Diversion of voyage due to war
Insolvency of
buyer/bank
Non acceptance of exported shipment
Default of buyer/bank
Commercial Risks
ECGC Policies
Specific Policy
For exports under Deferred Payments,
Project Exports,Service exports
Standard Policy
For short term shipments(180 Days)
Financial Guarantees to
Banks
For Giving credit to exporters
Special Schemes
(Transfer Guarantee )
To protect BanksIssuing L/C,
Confirming L/C,Insurance Cover,Line of Credit,
Overseas Investment Insurance & Exchange
Fluctuation Risk Insurance
Products offered to Exporters
Declaration Based Policy
Exposure Based Policy
Consignment Based Policy
Covers for IT Industry
Main Policies
Shipment Policy
Small Exporters Policy
Specific Shipment Policy
SME Policy
Benefits to Exporters
Protection for account receivable
Reduction in Bad debt
Improvement in quality of financial planning
Enhancement in risk taking capacity
Easy access to bank finance on liberal terms
Benefits to Banks Contract of insurance between bank & ECGC
Protects banks against losses in export credit due to
- Insolvency of exporter
- Protracted default of exporter
Protection For Pecuniary Liabilities
Enables To Waive Collateral Securities
Lesser Capital Deployment requirement.
Bibliography
https://www.ecgc.in/portal/
http://en.wikipedia.org/wiki/Export_Credit_Guarantee_Corporation_of_India
Thank you.