Export Credit Guarantee Corporation of India (ECGC) : An Overview

EXPERT CREDIT GUARANTEE CORPORATION OF INDIA (ECGC) : AN OVERVIEW

Essential for All Upcoming Bank Exams

Introduction: 

• On 30th July, 1957, Export Credit Guarantee Corporation of India Limited (ECGC Limited) was established. 
• It is wholly owned by Government of India. 
• It is headquartered in Mumbai, Maharashtra, India. 
• It is regulated by the Ministry of Commerce and it also deliver export credit insurance support to Indian exporters. 
• The Indian government first established the Export Risk Insurance Corporation (ERIC) in July 1957. 
• Without fear of losses, the exporters were able to expand their foreign business. 
• It operates under the administrative control of the Ministry of Commerce and Industry and is governed by a board of directors, representing the government, the Reserve Bank of India, the banking, and the insurance and exporting communities. 
• Shri T C Kapur was the First Managing Director of the Corporation and Shri Ratilal M Gandhi was the First Chairman of ECGC. 

History of ECGC: 

• In 1947, the need for introduction of export was immediately started. 
• In a meeting of the Export Advisory Council, it was proposed to introduce export credit guarantee scheme in 1953. 
• In 1955, the Ministry of Commerce and Industry analyzes the competition and depth of the Export Credit Insurance Plan and a revised draft proposal is presented to the Export Advisory Council. 
• On July 30, 1957, the government accepted the recommendation of the Kapoor Committee and thus registered with Export Recycle Insurance Corp. (ERIC), Mumbai, as a Private Limited. 
• October 14, 1957, Union Commerce Minister Shri Morarji Desai inaugurated the first policy of ERIC was issued. 
• In the year 1964, the name of ERIC was changed to Export Credit and Guarantee Corporation Limited. 
• In August 2014, it was named Export Credit and Guaranty Corporation Limited (ECGC Limited). 

Objectives: 

• In terms of profits, financial and operational efficiency indicators, to achieve improved performance and to get the best return on investment. 
• In order to protect Indian exporters against unexpected losses, which may be facing the problems of buyers, banks or buyers, the cost-effective credit insurance can be equally equal in the form of policies, factoring and investment insurance services. Available cover for exporters in other countries. 
• Employees develop world-class skills in credit insurance and ensure continuous innovation and achieve top customer satisfaction by providing top quality services. 
• For encouraging and facilitating the globalization of India's trade. 
• To educate customers through continuous promotion and effective marketing. 
• Providing assured insurance cover for bankers at a competitive rate to facilitate adequate bank financing to Indian exporters. 
• Providing timely information on the needs of buyers, bankers and the country, to assist Indian exporters in managing their credit risk. 

Functions: 

• In the form of equity or debt and progress, joint venture overseas, the investor is giving foreign investment insurance to Indian companies. 
• Enables banks and financial institutions to develop their quality better. 
• Contrary to losses in the export of goods and services, the credit risk insurance cover is provided to the exporters. 

ECGC Provides: 

• Provides information from different countries with its own credit rating. 
• Export financing from banks / financial institutions makes it easy. 
• Provider’s insurance protection against payment risk is available. 
• Helps the exporters to recover bad debts. 
• Manage export related activities.