Soon, govt may re-introduce credit insurance scheme for jewellery exporters

Since the $2-billion Punjab National Bank scam was discovered last year, the entire gems and jewellery sector has faced a massive liquidity crunch, as banks have put it on a negative list

The government is planning to re-introduce the export credit guarantee (ECG) insurance scheme in a month to ease liquidity tightness in the gems and jewellery sector.

Speaking on the sidelines of the Banking Summit 2019, P N Prasad, deputy managing director, State Bank of India, said, the ECG insurance would be restarted in a month.

ECG insurance covers defaults by Indian exporters or overseas importers for lenders. Banks currently finance for both pre- and post-shipment of goods. These will also be covered under the Export Credit Guarantee Corporation (ECGC). The ECGC will guarantee lenders recovery of amount from borrowers.

Since the $2-billion Punjab