export credit agency
export credit agency (ECA)
International, United Kingdom
A private, governmental or quasi-governmental agency which provides support to promote the export of goods and services from the country in which the export credit agency (ECA) is based.
The support can take the form of loans, guarantees or insurance, depending on the mandate the ECA has been given by its government:
Loans: The ECA provides a loan to the overseas purchaser of an export to enable the purchaser to finance the purchase.
Guarantees: The ECA provides a guarantee to the lenders financing the purchase of an export, guaranteeing repayment of their loan in certain circumstances. This guarantee lowers the risk of a transaction and allows lenders to enter into financings which might otherwise not be possible, due to credit or jurisdictional issues. Alternatively, the ECA may guarantee a loan made to an exporter in order to facilitate exports.
Insurance: The ECA provides insurance (and sometimes reinsurance) to exporters against non-payment by the overseas purchasers of their products. An ECA may also provide political risk insurance to companies based in its jurisdiction investing overseas.
Examples of ECAs include the Export Credits Guarantee Department (ECGD) (UK), the Export-Import Bank of the United States (United States), Compagnie Francaise d'Assurance pour le Commerce Exterieur (COFACE) (France) and Euler Hermes Kreditversicherungs-AG (Germany).

Practical Law Dictionary. Glossary of UK, US and international legal terms. . 2010.

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