Exim Bank, Commercial Bank and Ecgc Functions Essay

The Banks functions are segmented into several run groups including* embodied Banking Group which handles a variety of funding programmes for Export orientated Units (EOUs), Importers, and overseas investment by Indian companies. * Project Finance / slew Finance Group handles the entire range of export credit operate such as suppliers credit, pre-shipment credit, purchasers credit, pay for export of projects & consultancy function, guarantees, forfeiting etc. * Lines of consultation Group Lines of Credit (LOC) is a finance mechanism that provides a safe mode of non-recourse financing option to Indian exporters, especially to SMEs, and serves as an effective market entry tool.* Agri Business Group, to head the initiative to promote and support Agri-exports. The Group handles projects and export transactions in the agricultural sector for financing. * Small and Medium Enterprises Group to the specific financing requirements of export oriented SMEs. The group handles credit p roposals from SMEs under various lend programmes of the Bank. * Export Services Group offers variety of advisory and value-added information services aimed at investment promotion* Fee based Export marketing Services Bank offers assistance to Indian companies, to enable them establish their products in overseas markets. * Besides these, the Support Services groups, which include Research & Planning, Corporate Finance, Loan Recovery, Internal Audit, centering Information Services, Information Technology, Legal, Human Resources Management and Corporate AffairsThe objectives and functions of the Exim Bank include the following 1.Grant of loans and advances in India only or conjointly with commercial coin banks to persons exporting or intending to export India goods which whitethorn include the export of turnkey projects and civil consultancy services.2.Grant of lines credit to Governments, financial institutions and other(a) suitable organizations in foreign countries to enable pe rson outside India to event from India, goods including turnkey projects, civil construction contracts and other services including consultancy services. 3.Handling transaction where a mix of government credit and commercial credit for exports is involved. 4.Purchasing, discounting and negotiating export bills.5.Selling or discounting export bills in international markets. 6.Discounting of export bills negotiated or secured by a scheduled bank or financial institution notified by government, or granting loans and advances against such bills. 7.Providing refinance facilities to specified financial institutions against credits extended by them for specified exports or imports. 8.Granting loans and advances or effect guarantees solely or jointly with a commercial bank for the import of goods and services from abroad.9.Issuing confirmation/endorsing earn of credit on behalf of exporters in India, negotiating, collecting bills under letters of credit, crack letters of credit on beha lf of importers of goods is services and negotiating documents received there under. 10.Buying and marketing foreign exchange and performing such other functions of an authorized lead as whitethorn necessary for the functions of an export- import bank. 11.Undertaking and financing research, surveys and techno-economic studies bearing on the promotion and development of international trade. 12.Providing technical, administrative and financial assistance to all exporter in India or any other person who intends to export goods from India for the promotion, solicitude or expansion of any industry with a view to ontogenesis international trade.* Functions of commercial banks in foreign trade1. Letters of Credit IssuedIf you are the buyer (importer) of goods from abroad, the seller (exporter) will want to be aware of allowance, and you will want to be assured that all impairment and conditions of the purchase agreement are kept. The most common instrument used for payment and shipm ent control is a letter of credit issued by the bank of the buyer in favor of the seller.2. Advising BankAfter the bank of the buyer approves the issuance of the letter of credit, the issued letter of credit is sent to the advising bank who establishes the genuineness of the instrument and informs the beneficiary of receipt.3. Confirmed letter of creditThe advising bank may confirm the letter of credit after checking the terms and conditions for payment by adding its own guarantee to that of the issuer.4. Final PaymentAfter all of the terms and conditions for shipment and quality standards have been checked via the presentation of proper documentation, the issuing bank pays the seller for the goods.