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A presentation on COMPARITIVE STUDY OF ecgc AND ITS COMPETITORS & SWOT ANALYSIS PRESENTED BY:- ASMA KHAN
A presentation on
COMPARITIVE STUDY OF ecgc AND ITS COMPETITORS& SWOT ANALYSIS
PRESENTED BY:- ASMA KHAN
Introduction:-
In an export trade, exporters needs the finance at different stages. The finance is required for processing, manufacturing, assembling, procuring and packing the goods for export in the pre-shipment stages & During the intervening period between the shipment of goods and the receipt of payment post-shipment credit is required by the exporters at post shipment stages.
Need of export credit insurance:-
The export credit plays a very important role in the International trade system. In developed and developing countries, it has been a tool for pushing exports of manufactured and capital goods, as well as some specific services. Due to higher risk in International market, credit insurance becomes important. Export credit insurance protects exporters against the risk of non-payments by the foreign buyers.
LIST OF THE MAJOR COMPANIES PROVIDING EXPORT CREDIT INSURANCE:-
Public sector: i.) ECGC ii.) New India
Assurance iii.) SBI general
insurance Private sector: i.) ICICI Lombard ii.) IFFCO-Tokio
INTRODUCTION OF EXPORT CREDIT GUARANTEE CORPORATION:-
ECGC ( Export Credit Guarantee Corporation) of India Ltd, was established in July, 1957. It functions under the administrative control of the Ministry of Commerce & Industry and Government of India. It is managed by a Board of Directors comprising representatives of the Government, Reserve Bank of India. Its headquarter is in Mumbai, Maharashtra.
Objectives:- To promote export mainly by i.) Protecting Exporters against COMMERCIAL
& POLITICAL RISKS in export proceeds
ii.) Protecting Banks against RISK OF DEFAULT in export credit.
iii.) To facilitate availability of adequate bank finance to the Indian exporters by providing insurance cover for banker in the form of guarantee at competitive rate.
COMPETITORS OF ECGC:-
In the Indian market the competitors of ECGC are PUBLIC SECTOR:- i.) New India Assurance ii.) SBI General Insurance PRIVATE SECTOR:- i.) ICICI Lombard ii.) IFFCO-Tokyo
Comparison through different parameters:-
i.)Risk coverage by companies ii.)Risk exemptionsiii.)Transactions modesiv.)Countries coveragev.)Exporters Reach vi.)Claimsvii.)Bank loan assistance to exportersviii.)Premium Calculation
1. RISKS COVERAGE
Basis of difference
ECGC SBI-GENERAL
ICICI-Lombard
IFFCO-TOKIO
New India Assurance
Restriction by Govt. COVERED
COVERED COVERED COVERED COVERED
Non-payment due to war
COVERED COVERED COVERED COVERED COVERED
Cancellation of import license
COVERED COVERED COVERED COVERED COVERED
Delay in payment
COVERED NOT COVERED
NOT COVERED
COVERED COVERED
Diversion of Voyage
COVERED NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
Natural disaster
NOT COVERED
NOT COVERED
NOT COVERED
COVERED NOT COVERED
2.RISK EXCLUSION
Basis of difference
ECGC SBI General
ICICI-Lombard
IFFCO-Tokio
New India Assurance
Exchange rate fluctuation
NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
Loss of goods
NOT COVERED
COVERED NOT COVERED
NOT COVERED
NOT COVERED
Trade dispute
NOT-COVERED
NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
Default and insolvency
COVERED COVERED NOT COVERED
NOT COVERED
NOT COVERED
Delay in payment
COVERED NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
Non –payment
NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
Non-acceptance of goods
COVERED NOT COVERED
NOT COVERED
NOT COVERED
NOT COVERED
3.MODES OF PAYMENTS
Types of Payments
ECGC SBI-General Insurance
ICICI-Lombard
IFFCO-Tokio
New India Assurance
Letter of Credit
COVERED COVERED COVERED COVERED COVERED
Document against Payment
COVERED NOT-COVERED
NOT-COVERED
NOT-COVERED
NOT-COVERED
Open Delivery
COVERED NOT-COVERED
NOT-COVERED
NOT-COVERED
NOT-COVERED
Document against Acceptance
COVERED NOT-COVERED
NOT-COVERED
NOT-COVERED
NOT-COVERED
4.COUNTRIES COVERAGE
ICICI-Lombard SBI-General Insurance
New India Assurance
IFFCO-Tokio
Egypt Iran Iceland--------------
Jordan Cuba Tunisia--------------
Libya Pakistan ---------------
Yemen Iraq---------------
Fiji Sudan---------------
Sudan----------------
5.COVERAGE
COMPANY COVERAGE
ECGC 80%-90 %
New India Assurance 85 %
IFFCO-TOKIO 90 %
ICICI-Lombard 90 %
SBI General insurance N.A
6.PREMIUM CALCULATION
ECGC SBI-General Insurance
ICICI-Lombard
IFFCO-Tokio
New India Assurance
Country basis
Turnover Country basis
Country basis
Country basis
On the basis of Term of Payment
Turnover Re-insurance quote & support
Bank assistance:-
ECGC provides export credit insurance covers to the banks and financial institutions to enables the exporters to obtain better facilities from them i.e. from banks which is formally known as guarantee.
No other competitor of the ECGC provides export credit insurance cover to the banks.
SWOT Analysis:-SWOT analysis of ECGC is as under :i.) Strength :- a.) Maximum country coverage. b.) Maximum coverage from risk.ii.) Weakness:- a.) Communication gapiii.) Opportunities:- a.) In the sector of factoring iv.) Threats:- a.) Weakness will become threat.
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