Buyer's Credit is our unique credit facility programme that motivates Indian exporters to explore new geographies. Through this programme, the overseas buyer can open a "letter of credit" in favour of the Indian exporter and can import goods and services from India on deferred payment terms.
While on the one hand, the exporter enjoys reduced transaction costs and complexities of international trade transactions, on the other hand, the Indian exporter gets to compete in the international market and can continue to put his working capital to good use to scale up operations.
While Indian companies avail of buyers credit from other international financial institutions in order to finance their imports at competitive rates, buyer's credit that we provide can only be used for the export of Indian goods or services.
Salient features
Facilitates exports for SMEs by providing credit to overseas buyer to import goods from India
Offered for financing capital goods or services on deferred payment terms
Provides non-recourse finance to Indian exporters by converting deferred credit contract into cash contract
Extended as advance payments to Indian exporters on behalf of the overseas buyer
Can be a transaction specific financing or a revolving/renewable limit
Can be extended to more than one overseas subsidiaries of any Indian company
Since it is a non-LC transactions, it saves LC charges
Benefits to Foreign Customer
Medium and long-term financing facilities for smooth execution of projects
Competitive and attractive rates of interest available against host country's high borrowing cost
Eligibility Criteria
Eligible Borrowers
Buyer's credit is extended to a foreign project company that intends to award the project execution to an Indian project exporter.
Project Scope
The financing will be available to all kinds of projects and service exports from India.
Supported Sectors & Services
The facility is available for development, upgrading or expansion of infrastructure facilities; financing of public or private projects such as plants and buildings; professional services such as surveyors, architecture, consultations, etc.
Exim Advantage
` nables overseas buyers to obtain medium and long-term financing
` Competitive interest rate against host country's high cost of borrowing
` Encourges Indian exporters to enter international markets
` Allows Indian exports to utilize their working capital for scaling up their core business
List of documents required
Request letter from Indian exporter for disbursement, specifying the remittance details where the disbursement amount is to be remitted
Non-negotiable copy of shipping documents
Promissory note covering the eligible value (disbursement amount) of export contract
Trust receipt covering value of consignment financed by disbursement under the Buyer's Credit facility
Authorization letter from borrower to disburse the eligible value under the Buyer's Credit facility and remit it to the Indian exporter.
Buyer's Credit under NEIA
National Export Insurance Account (NEIA) is a trust set up by the Ministry of Commerce and administered by ECGC Ltd. We provide Buyer's Credit under NEIA for promoting India's project exports to traditional as well as new markets in developing countries which need deferred credit on medium or long-term basis.
Under this unique financing programme, we extend credit to overseas sovereign governments and government-owned entities for import of Indian goods and services from India on deferred credit terms for a medium to long-term period.
Eligibility Criteria
Direct Credit to Overseas Buyers
Exim Bank extends the credit directly to overseas buyer of projects from India without recourse to Indian exporters.
Eligible Borrowers
The borrower should be overseas sovereign governments or a government-owned entity.
Loan Limit
Amount of loan should generally not be more than 85% of the contract value.
Sovereign Guarantee Requirement
Sovereign guarantee is needed where the borrower is other than the foreign government.
Central Bank Guarantee
Guarantee from Central Bank of borrower, as applicable.
Additional Security Provisions
Any other security as may be stipulated on a case-to-case basis.
Exim Advantage
` Unique financing solution
` Works as an insurance cover for the Indian exporters
` Encourages Indian companies to test new markets
` Government-backed security
