Documentary Credit Insurance Policy (DCIP)

How it works?

The EXIM Bank’s DCIP protects confirming (exporter) Banks against the risk of non-payment of an issuing (importer) Bank.

The main aim of this offering is to provide Confirming Bank coverage against non-payment of Issuing Bank Risk creating possibilities to sell Pakistani goods and services in what would be considered as ‘difficult’ markets.

Insurance Cover:

  • Pakistani exporter receives order from its foreign buyer backed by Letter of Credit.
  • The importer bank issues LC on behalf of importer and advise it to the exporter’s bank.
  • Exporter bank submits proposal for EXIM’s DCIP detailing the terms and conditions of issuing bank.
  • After positively assessing the creditworthiness of the issuing bank, EXIM Bank prepares a quotation confirming the insurance credit limits of the confirming bank, premium percentage etc.
  • Upon banks acceptance of the offer, EXIM Bank will issue DCIP along with confirmation of cover detailing the credit limit of issuing bank, risk disclosures and accepted payment terms.

Exporter Bank / Confirming Banks.

For Banks:

  • Protection of Balance sheet and risk mitigation. Additional risk appetite for business growth.

For Exporters:

  • Banks will be willing to take on more risk resulting in availability of secured business in challenging markets.