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Export Credit Insurance Defined



Export Credit Insurance

Export Credit Insurance (ECI) mitigates the payment risk associated with foreign trade. ECI guarantees payment on commodities exported to foreign country and thus protects the exporter against non-payment.

A Little More on Export Credit Insurance

The Export Credit Insurance or ECI mitigates payment risk associated with international business. More specifically, it ensures and encourages exporters by giving conditional assurance of payment in case of nonpayment by foreign buyers.

The Export Credit Insurance covers broad categories of risks. For instance, the ECI insure exporters against commercial risk (default, bankruptcy, and insolvency of the buyer) and political risk (including war, revolution, terrorism etc.). The Export Credit Insurance also covers currency risk and import and export regulations that may result in losses.

References for ECI

https://www.export.gov/article?id=Trade-Finance-Guide-Chapter-9-Export-Credit-Insurance
https://en.wikipedia.org/wiki/Trade_credit_insurance
https://www.icisa.org/trade-credit-insurance/1547/mercury.asp?page_id=1673


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