One of the concerns of exporters has always been political and commercial risks in their export procedures, because these risks will lead to payment defaults for the exported goods and services. Untimely collection of debts owed by foreign buyers ratchet up financial pressure on exporters and will consequently disable them in fulfilling their financial obligations to domestic creditors and sometimes that could end in full bankruptcy.
In order to encourage exporters to expand their export activities and allay their concerns on this issue and providing them with necessary cover against political and commercial risks, governments move to establish Export Credit Agencies (ECAs). Such agencies are mainly affiliated to governments and depend on their financial support and they often cover risks that other credit insurance companies cannot cover.
In order to provide financial security to Iranian exporters and effectively boost non-oil exports in the country, the Export Guarantee Fund of Iran (EGFI), an affiliate of Ministry of Industry, Mine and Trade, was established as an independent legal and financial entity.
Relying on government support, this fund covers political and commercial risks of export in addition to issuing Credit Guarantees (surety) to provide the exporters with the necessary finance.