ECGC Reduces Premium for Exporters By 17%

ECGC Reduces Premium for Exporters By 17%

The government-owned ECGC (ECGC) has reduced premium rates on an average by 17 per cent for exporters, but it is unlikely to cut rates on providing covers to banks as losses from bank portfolios have been rising.

“We are giving on an average 17 per cent discount from April one onwards. The discounts vary between five per cent and 45 per cent depending on the country, risk and terms of payment,” chairman-cum-managing director of ECGC Geeta Muralidhar said.

“However, the premium rates on bank covers will remain flat and will be reviewed once they come up for renewal,” Muralidhar said.

The loss ratio of each bank differs and the premium rates for a bank would depend on its loss experience. While the exporters portfolio is profitable for ECGC, the banks’ portfolio has been loss making.

ECGC paid total claims of Rs 1,122.84 crore to both Indian exporters and financing banks during 2015-16

Major sectors under which the claims arose include readymade garments, synthetic yarn and leather.