We make exports from India 'Risk Free!' – GM, ECGC

15 Sep '09

9 min read

Mr V Viswanathan

F2F: Exporters claim that the accuracy of creditability reports of buyers given by ECGC is not satisfactory. Why is ECGC not available to satisfy exporters in its prime role? Is it because of the monopoly position which has made it complacent in its attitude?

VV: We would like to first of all clarify that ECGC is not a Credit Information organization, ECGC like any exporter sources its credit information from reputed credit information agencies like Dun & Bradstreet, Graydon etc., Based on such credit reports obtained from the agencies and the experience that the Corporation has gained with the buyer concerned as well as the exporter who is seeking a credit limit, decisions are taken.

Approving a credit limit on a buyer (indicating ECGC's willingness to provide cover in case of buyer failure) does not in any way guarantee the credentials of the buyer or his ability to pay but it is only the ECGC's ability to insure the payments due from the buyer and accordingly pay a claim in case the exporter does not receive payments from the buyer for a shipment for which a cover from ECGC has been obtained from ECGC apart from approval of credit limit on the buyer.

ECGC has been in existence for well over 50 years and has been very proactive in designing covers and meeting the credit insurance requirements as well as claims of exporter in due time. Our performance speaks for our services. As regards your observations about the monopolistic status, we may mention that with the opening up of the insurance sector, there are more than half a dozen general insurance companies that are in the field of credit insurance and they are in existence for well over 6 to 7 years, The fact that their existence itself is not known to Indian exporters itself speaks for the successful operations of the Corporation.

As regards your observations that the monopolistic position could be a reason for the complacent attitude, we would like to inform you that credit insurance in India is optional and there is no force of law to make it obligatory for an exporter to take our insurance. You will very well know as to the difficulties such an organization will have to face to get business and retain it. ECGC is a pioneer in computerization and today 100% of our operations are computerized that enables us to render speedy and effective service.

We would like to inform you that ECGC is the only PSU Insurance Company that signs a memorandum of Understanding with its parent ministry for evaluation of its performance. The Corporation is adjudged as an excellent performer over the years and for 2005-06 we were rated as one of the top 10 best performing PSU. Besides, last year, SCOPE rated us as the best managed company under the Banking and Insurance companies' category. The Corporation has been very modest in not publicizing these achievements as we always feel that our performance rather than publicity should speak for us.

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