Export finance glossary index by desk

This export finance glossary index maps core glossary entries for bank EF desks: official support, trade instruments, guarantees and country-risk concepts. Each line links to a glossary entry and restates that page's one-line description.

Official support and Arrangement

• Export Credit Agency (ECA): An export credit agency (ECA) is a public body that supports national exports with insurance, guarantees or official financing.
• OECD Arrangement: The OECD Arrangement sets disciplines on officially supported export credits among its Participants for repayment terms of two years or more.
• OECD Country Risk Classification: The OECD country risk classification places countries in categories 0 to 7 to set minimum premiums for officially supported export credits.
• ECA Premium: An ECA premium is the fee an export credit agency charges for insurance or guarantee cover, floored by OECD minimum premium rates where they apply.
• Commercial Interest Reference Rate (CIRR): The commercial interest reference rate (CIRR) is the OECD Arrangement minimum fixed interest rate for officially supported export credits by currency.
• Tied vs Untied Financing: Tied vs untied financing contrasts official support that requires donor-country procurement with finance freely available for wider procurement.
• Untied Loan Guarantee: An untied loan guarantee is official ECA cover for a foreign loan that is not conditioned on procurement from the supporting country.
• National Content Requirements: National content requirements set the minimum home-country content an ECA expects in an export contract before granting official support.
• UKEF (UK Export Finance): UK Export Finance (UKEF) is the UK's export credit agency, providing insurance, guarantees and loans so viable UK exports are not lost for lack of finance.
• US EXIM (Export-Import Bank of the US): EXIM is the official US export credit agency, providing loans, guarantees and insurance to support US exports when private finance is unavailable.
• Berne Union: The Berne Union is the international association for export credit and investment insurers, spanning official ECAs, multilaterals and private underwriters.

Credit structures and risk transfer

• Buyer Credit: Buyer credit is bank or official financing to an overseas buyer so the exporter is paid while the buyer repays over time.
• Supplier Credit: Supplier credit is deferred payment terms from an exporter to a foreign buyer, often insured or refinanced with ECA support.
• Buyer Credit Guarantee: A buyer credit guarantee is official ECA cover of a bank loan to an overseas buyer so an exporter can be paid while the buyer repays over time.
• Export Credit Guarantee: An export credit guarantee is official ECA cover that protects a bank or exporter against non-payment on an export credit.
• Export Credit Insurance: Export credit insurance is official or private cover that indemnifies an exporter or lender against non-payment on an export contract.
• Comprehensive Cover: Comprehensive cover is ECA insurance or guarantee protection against both commercial and political risks of non-payment on an export credit.
• Syndication: Syndication is the process of arranging a loan among multiple lenders so commitment size, risk and funding are shared under one facility.
• Risk Participation: A risk participation is an unfunded transfer of credit risk on a loan, where the participant reimburses the grantor if the borrower fails to pay.
• Sub Participation: A sub-participation transfers the economic risk and return of a loan to a participant while the grantor remains lender of record to the borrower.

Documentary credits and guarantees

• Letter of Credit: A letter of credit is an irrevocable bank undertaking to honour a complying presentation of documents under agreed credit terms.
• Confirmed Letter of Credit: A confirmed letter of credit adds a second bank's irrevocable undertaking to honour or negotiate a complying presentation.
• Standby Letter of Credit: A standby letter of credit is an irrevocable, independent bank undertaking payable against documents if the applicant defaults.
• Documentary Collection: A documentary collection is bank handling of financial and commercial documents to obtain payment or acceptance under URC 522.
• Demand Guarantee: A demand guarantee is an independent undertaking to pay on a complying demand, commonly governed by ICC URDG 758.
• Performance Bond: A performance bond is contract security that supports proper performance, often issued as a bank demand guarantee under URDG 758.
• Bid Bond: A bid bond is tender security, usually a demand guarantee, that compensates the employer if the bidder fails to honour a winning bid.
• Advance Payment Guarantee: An advance payment guarantee secures repayment of a contract mobilisation advance, usually as a reducing demand guarantee.
• Forfaiting: Forfaiting is without-recourse discounting of an exporter's future trade receivables evidenced by transferable payment instruments.
• Factoring: Factoring is a receivables finance contract in which a supplier assigns trade debts to a factor that finances, ledgers, collects or covers default.

Country and political risk

• Commercial Risk: Commercial risk is the risk of non-payment on an export credit caused by the buyer's insolvency, bankruptcy or protracted default.
• Country Risk: Country risk is the risk that a sovereign or host-country environment prevents or delays repayment of external debt or cross-border obligations.
• Transfer Risk: Transfer risk is the risk that capital or exchange controls prevent conversion of local currency or remittance of funds to foreign creditors.
• Currency Inconvertibility: Currency inconvertibility is the inability to convert local currency into hard currency, or to transfer hard currency abroad, due to government action.
• Political Risk Insurance: Political risk insurance covers investors and lenders against defined non-commercial risks such as expropriation and transfer restriction.
• MIGA Cover: MIGA cover is Multilateral Investment Guarantee Agency political risk insurance and credit enhancement for investment into developing members.