On January 2, 2026, the Government launched two critical interventions under the NIRYAT PROTSAHAN sub-scheme of the Export Promotion Mission (EPM) to provide affordable credit and collateral support to MSME exporters.
Strategic Support for Export Credit
1. Interest Subvention for Export Credit
The Mechanism: This acts as a revamped version of the old “Interest Equalisation Scheme.” The government pays a portion of the interest directly to the bank, allowing the exporter to borrow at a cheaper rate.
Quantum of Support:
A base interest subsidy of 2.75% is provided on Rupee export credit.
Incentives: Additional incentives are available for exports to “under-represented” or emerging global markets.
Scope:
Covers pre-shipment credit (working capital to manufacture goods) and post-shipment credit (financing needed until the foreign buyer pays).
Applicable to a “Positive List” of products, covering ~75% of India’s tariff lines with high MSME presence.
Cap: For FY 2025–26, there is an annual cap of ₹50 lakh per Importer Exporter Code (IEC).
2. Collateral Support for Export Credit
Partnership: Implemented in collaboration with the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE).
Objective: To help exporters who lack physical assets (like land or buildings) to pledge as security for bank loans.
Guarantee Coverage:
Up to 85% for Micro and Small exporters.
Up to 65% for Medium exporters.
Financial Limit: A maximum guaranteed exposure of ₹10 crore per exporter per financial year.
Significance: By removing the “collateral headache,” the government encourages banks to lend to first-time and small-scale exporters who have orders but no assets.
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