1. Need for such type of finance? The institutions which provides the credit, EXIM BANK COMMERCIAL BANK ECGC

2. RBI ensures a free flow of financial assistanceto exporters at a concessional rate of interestagainst export order The commercial banks provide the loan at areduced interest Commercial banks get re-finance facility byRBI and EXIM bank against the loan extendedby them to the exporters 3. Pre-shipment finance Post-shipment finance 4. Provides working capital finance to an exporter Basic purpose is to enable the eligible exportersto procure raw materials, supplies, process ormanufacture, warehouse or ship the goodsmeant for exports 5. Packing credit Advance against incentives receivables fromgovt. covered by ECGC guarantee Advance against cheque /drafts received asadvance payment 6. Enables an exporter to pack the goods meantfor exports Includes loan/advance/credit granted by abank to an exporter to buy raw materials,supplies, etc. required for processing,manufacturing, packing of goods for exports Facility can be shared with supportingmanufacturer or the sub-supplier 7. Pre-shipment finance is granted for a shortperiod of time as it is essentially a workingcapital finance. Initially it is 180 days subject to lead time In case of unforeseen circumstances the bankmay give a 90 days extension Max. period is 270 days. 8. PERIOD OF CREDIT RATE OFINTERESTUpto 180 daysnot exceeding PLRminus 2.5 %age points.180-270 days not exceeding PLR plus 2.5 %age points.270-360 days fixed by the bank. 9. Exporter should: arrange the set of docs as stipulated in the L/C submit the docs. along with the Standardized Letterto bank for collection/negotiation of docs. This letter to the bank provides comprehensivecoverage of the various points 10. This form of finance is available after the shipment of goods This facility is extended to the exporters in whose name the goodswere shipped OR an exporter in whose name export documentsare transferred. It can be short term finance or a long term finance dependingupon the nature of export. It is essentially a working capital finance granted on the strengthof accounts receivables. This facility is extended only against the shipping documentswhich evidence that the goods have been shipped Credit is extended to finance export receivables for the periodcommencing from the date of submission of docs. to the bank tothe date of realisation of export proceeds. The post shipment credit is essentially a form of fund basedfinancing The concessional rate of interest is charged upto a maximumperiod of 6 months from the date of shipment of goods 11. Negotiation/Payment/Acceptance of export docs.under L/C Purchase/ Discount of export docs underconfirmed orders/ export contracts etc. Advances against export bills sent on collectionbasis Advances against undrawn balance of exports Advances against receivables from GOI Advances against retention money relating toexports Advances against approved deemed exports