BTL 868 - Interest Subvention for Export Credit 2026

 

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BTL 868                                                                               09-02-2026

Interest Subvention for Export Credit 2026

Under the Niryat Protsahan (Financial Enablers) sub-scheme of the Export Promotion Mission (EPM), the Government of India provides specific interest support to reduce credit costs for exporters. This initiative was launched in early January 2026 to replace and refine the previous Interest Equalisation Scheme.

Interest Subvention Rates

Base Rate: A standard interest subvention of 2.75% per annum is available for both pre-shipment and post-shipment rupee export credit.

Additional Incentive: There is a provision for extra incentives for exports directed toward notified under-represented or emerging markets, though these are subject to operational readiness.

Key Features & Eligibility

Target Group: The benefit is exclusively for MSME manufacturer exporters and merchant exporters.

Annual Cap: Each exporter (per Importer-Exporter Code - IEC) is subject to an annual benefit cap of ₹50 lakh for FY 2025–26.

Coverage: Support is restricted to a "Positive List" of approximately 4,139 tariff lines (at the HS 6-digit level), which covers about 75% of India's total tariff lines where MSME participation is high.

Validity: The scheme is part of a broader six-year mission spanning from FY 2025–26 to FY 2030–31.

Exclusions: Prohibited/restricted items, waste, scrap, and products already covered under other incentive schemes (like PLI or RoDTEP) are excluded.

Application Process

To access this benefit, eligible exporters must first file an "Intent to Avail" on the DGFT Portal to generate a Unique Identification Number (UIN). This UIN is then used to approach banks, which pass the interest benefit upfront and later claim reimbursement through the Reserve Bank of India.

Key aspects of this intervention include:

Coverage: Applies to both pre-shipment (packing credit) and post-shipment rupee export credit.

Support Level: A base rate of 2.75% is provided, with additional incentives for exports to specific emerging or under-represented markets.

Eligibility: Targeted at MSME exporters, covering a defined positive list of tariff lines, which constitutes approximately 75% of India's total tariff lines.

Implementation: The benefit is passed on upfront by lending institutions, which are then reimbursed by the RBI.

Goal: To reduce the cost of export finance, making Indian MSME products more competitive in international markets.

The Niryat Protsahan scheme also includes a collateral guarantee component, supporting up to 85% for Micro and Small enterprises and 65% for Medium enterprises, with a maximum guarantee of ₹10 crore per exporter.

Sekhar Pariti

+91 9440641014