One of the
concerns of exporters has always been political and commercial risks in their
export procedures, because these risks will lead to payment defaults for the
exported goods and services. Untimely collection of debts owed by foreign buyers
ratchet up financial pressure on exporters and will consequently disable them
in fulfilling their financial obligations to domestic creditors and sometimes
that could end in full bankruptcy.
In order to
encourage exporters to expand their export activities and allay their concerns
on this issue and providing them with necessary cover against political and commercial
risks, governments move to establish Export Credit Agencies (ECAs). Such
agencies are mainly affiliated to governments and depend on their financial
support and they often cover risks that other credit insurance companies cannot
In order to
provide financial security to Iranian exporters and effectively boost non-oil
exports in the country, the Export Guarantee Fund of Iran (EGFI), an affiliate
of Ministry of Industry, Mine and Trade, was established as an independent
legal and financial entity.
government support, this fund covers political and commercial risks of export
in addition to issuing Credit Guarantees (surety) to provide the exporters with
the necessary finance.