Introduction:
Protracted default and non-payment of export receivables on the side of the foreign buyers often lead to the exporters' credit crunch and shortage of liquidity and this in turn, may end in their inability to meet their payment obligations toward domestic creditors or even their total insolvency or bankruptcy. Therefore, it is a long time since Export Credit Agencies (ECAs) started their activities and as the crucial and vital components of the export financial system of the countries and one of the major economic pillars and supporting arms of the governments, act on behalf of the state to manage and mitigate credit risks involved in international trade.
Export credit insurance industry first started in the early 19^th century in Europe, when the main ECA's role was to insure export receivables against commercial risks such as foreign buyers' non-payment, protracted default, fraud, insolvency or against political risks such as tense political relationship between the exporter and foreign buyer's country or adopting restrictive policies or regulations for trade and foreign exchange policies in between the two countries. In this way the ECAs managed the credit risks involved in international trade and safeguarded the exporters against possible claims.
Moreover, export credit agencies supported financing banks who involved in the allocation of export facilities in the form of suppliers' credit, buyers' credit, or pre- shipment working capital, by providing them with credit guarantees to protect them against the outbreak of outstanding debts or claims.
History:
Following a period of decline of oil prices, Export Guarantee Fund of Iran (EGFI) was established in cooperation with UNCTAD in the early 1970s as the only state-run Export Credit Agency (ECA) affiliated to the Ministry of Industry, Mine and Trade, in order to support the country's exports and cover major commercial and political risks for Iranian exporters. About five decades of risk mitigation and receivables management for the Iranian exporters and banks is the Fund's honored record of providing unique services for the development of the country's exports. 
Export Credit Agencies Advantages:
Export Credit Agencies play the role of credit risk management for exporters and the banking system and financing bodies and provide the following merits:

• Creating the peace of mind for exporters on their export receivables through  covering the political and commercial risks in their international contracts;
• Promoting the power of risk acceptance of the Iranian exporters and contractors over their peer entities in the international arena;
• Gathering and updating the credit information and reliable data on the credit standing of foreign buyers and traders.
• Providing expertise and consultancy services on international trade finance and investment;
• Managing credit risk for banks and financial institutions involved in trade or project finance;
• Increasing foreign exchange income for Iranian traders via their international trade facilitation;
• Expanding export markets and international opportunities for traders in target markets as a result of the allocation of credit terms for their foreign buyers;
• Reducing  the trader’s export expenses as a result of the shift to open account transactions and the use of time drafts instead of contracts backed by LCs;
• Facilitating exports at tough times of political and economic sanctions and banking limitations;
• Developing trade ties between exporters and their foreign buyers/employers and changing the approach from traditional to modern competitive and customized exports;
• Improving the situation for Iranian investors investing in overseas projects via covering the political risks involved;

EGFI’s clients and beneficiaries:

• The exporters of goods,

(Raw materials, intermediary goods, commercial goods, finished goods, capital and semi-capital goods);

• The exporters of services

(Contractors, the companies providing techno-engineering services and consultancies)

• Banks and the financial and credit institutions

{Financial entities providing all sorts of export loans and facilities like: working capital, EPC site construction, sellers’ credit (discounting of export bills) and buyers’’ credit (finalizing finance agreement with the foreign debtor for the purchase of Iranian goods and services) and joint investment facilities};

• Manufacturers

(Who sell their goods and services to exporters on credit terms;)

• Iranian Investors (Overseas / Inland export oriented)

(Investing in overseas projects leading to the export of goods and services from Iran and enjoying a minimum of 50% national content)   
(Investing in export-oriented projects inside the country including the construction or development of projects with more than 60% export capacity)

• Foreign Employers/buyers, and credit institutions who seek EGFI's insurance and guarantee support

• Other Export Credit Agencies  and EGFI's counterparts or international financial Institutions

(Willing to share risks with EGFI in different coinsurance or reinsurance schemes and those ECAs who are inclined to expand their cooperation with EGFI on the exchange of information and credit assessment of the buyers in their respective countries.)

EGFI’s services for exporters of goods

• Credit worthiness assessment and setting the credit limit for foreign buyers or trade partners in other countries;

• Advantage: Getting well informed of the credit standing and the trade outlook of the foreign buyers as well as their payment records before or while finalizing any contracts;

• Specific Insurance Policy;

• Advantage: Getting sure of export receivables from one foreign buyer against one sales contract or every single shipment of export goods

• Whole-Turn-over Insurance Policy:

• Advantage: Getting sure of export receivables from different foreign buyers in different countries against several sales contracts or shipments of export goods within one year.

• Contract Frustration Policy:

• Advantage: Risk management of the unfair one sided cancellation of shipping order from the side of the foreign buyer, leading to the disruption of manufacturing of the ordered customized goods or the export contract frustration as a result of the outbreak of political risks.

• Customs Credit Guarantee:

• Advantage: Providing the facilities/guarantees needed to be presented to the I.R of Iran’s Customs House, for the temporary import of goods/raw materials for re-export against easier collaterals and securities to be presented by the clients.

 EGFI’s products for exporters of Techno-engineering Services:

• Credit worthiness assessment and setting the credit limit for foreign employers (sovereign/sub-sovereign/or private entities)

• Advantage: Getting well informed of the credit standing and the risk outlook of the foreign employers as well as their payment records before or while finalizing any techno-engineering contracts

• Techno-engineering Specific Insurance Policy;

• Advantage: Getting sure of contract receivables from one foreign employer against one techno-engineering contract as a whole or every single invoices sent to the employer for approval and payment

• Issuance of Surety (contract) Bond Guarantees (Bid Bond, Performance Bond, Advance Payment and Retention Bond Guarantees):

• Advantage: The possibility of providing the necessary bonds for
  off-shore projects and overseas employers by Iranian contractors through EGFI, with easier security package during the tough times of banking restriction and international sanctions imposed and the lack of banking relationships with their peer financial institutions;

• Issuance of credit Guarantees for the purpose of mobilization of construction site of EPC contracts:

• Advantages:

1) The possibility of providing the credit guarantees for Iranian contractors as the substitute for first rated securities required by the financing banks, with 2% discount in the banking interest allocated for loans based on the central bank of Iran’s decree
2) The possibility of securitizing real estates with their 100% evaluated prices according to the report of Justice Experts and
3) The possibility of considering the surplus value of real states (not collateralized portion) as the first rated security, and EGFI acting as the second entity for mortgage.

EGFI’s products for Manufacturers enjoying export capacities:

• Manufacturers’ Credit Guarantee:

• Advantage: Manufacturers may sell their goods to exporters on credit terms and backed by EGFI’s credit guarantee be certain of the return of their receivables from exporters;

• Export-Oriented projects’ Credit Guarantee:

• Advantage: Manufacturers investing in export-oriented projects may have access to MLT bank facilities for their development or construction projects backed through the credit guarantee issued by EGFI and provide the Fund with an easy-to-prepare security package which may include first and second rated securities, namely equity based collaterals and the allocation of income cash flows and returns of the project;

EGFI’s products for Banks and Financial Institutions:

• Credit Guarantees (Foreign Exchange or Local);

• Advantage: Iranian Banks and Financial Institutions who intend to grant short term local currency (Rial) loans or forex facilities to Iranian exporters with the aim of financing their export activities and providing their working capital, may obtain EGFI’s “Local Currency/Forex Credit Guarantee” as a substitute for the collateral they require to insure the repayment of the granted facility by the debtor, i.e. exporter, on the due date and manage their loan portfolio against payment defaults or bad debts.

• Discounting of Export Bills Insurance Policy:

• Advantage: Banks and financial institutions involved in the discounting/ factoring of export bills of the Iranian exporters may seek the insurance cover of the Fund to get sure that the receivables will definitely be compensated by EGFI on the due date, in case of the non- payment on the side of the foreign buyer.

• Buyers Credit Guarantee:

• Advantage: To insure the due repayment of the credit lines granted to foreign buyers/employers/banks, the Iranian financing bank may seek EGFI’s buyer’s credit guarantee so that they could enforce it as a sound security for the repayment of principle plus interest of the financed facilities according to the finance agreement in case the foreign debtor does not keep his commitments;

EGFI’s products for investors:

• Investment Insurance Policy:
• Advantage: The Iranian investors investing in overseas projects may enjoy EGFI’s free consultancy services to get a view of the investment climate of the target market and its risk outlook and get to know the Fund’s cover policy in that field of business and consequently may seek the Fund’s insurance cover against the three political risks (War, Expropriation and Non-transfer of foreign exchange currency) to safeguard their investment project or its proceeds through EGFI’s insurance cover. The Fund is ready to provide the insured with the cover provided that the investment project leads to at least 50% national content (export of goods, raw materials, machinery and expertise from Iran) and the political risk outlook is positive or stable;

EGFI’s General Risk Management & Consultancy services:
EGFI has access to a wide variety of sources of economic, political, financial and banking information and is linked to several different data centers and therefore constantly scrutinizes the international, regional and country specific changes and studies the banks and foreign companies' credit standing. As a result, the Fund may help Iranian exporters manage or mitigate the credit risks involved in their export contracts, and inform them of EGFI's cover policy, via providing its clients with credit reports on all the three levels (country risk, bank risk and corporate risk).
EGFI, uses the seven-category country classification system like OECD, and sets the country credit ceilings for Short, medium and long term credits. Also, the general economic and political conditions of different countries are regularly observed and followed, and country risk bulletins are issued on bimonthly or monthly bases and issued in Persian so that national companies could study the latest risk specific changes in their target markets.