Export Credit Guarantee Department
Export Credit Guarantee
Export Credit Guarantee Department (ECGD)the former UK government department which UNDERWRITES (insures) UK EXPORTS sold on CREDIT against nonpayment by foreign customers whether this is due to insolvency of the customer or, for example, the imposition of exchange controls by foreign governments, etc.
Until 1991 the ECGD provided both short-term and long-term export credits. Guarantees covering 90-95% of the loss of sales revenue were available for most exports sold on up to 6 months' credit, while extended cover is provided for certain exports (for example production engineering products) sold on up to 5 years' credit terms. In addition, the ECGD provides long-term cover (normally up to 15 years) for certain FOREIGN INVESTMENT projects against political risk.
In 1991 the provision of short-term export credits was taken over by a private sector concern, NCM. The ECGD itself is was transformed (2001) into a commercial concern outside immediate government control. See FACTORING.