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The Union Finance Minister introduced the Nirvik Scheme to provide greater insurance coverage to exporters. The Finance Minister announced the launch of the Niryat Rin Vikas Yojana while presenting the Union Budget for 2020. In the face of slowing exports, the scheme encourages exporters with high insurance coverage to invest. The scheme is being introduced as a new initiative to increase export credit disbursement. It will provide loans to all exporters. The Finance Ministry has set a goal of investing 100 lakh crores in the next five years through this scheme. All exporters will receive up to 90% insurance coverage under the NIRVIK Scheme.Â
About Niryat Rin Vikas Yojana
The Indian economy is built on two major pillars: trade and commerce. Small, medium, and large exporters pool their revenue and deposit it in the central government’s coffers. However, the ups and downs in the market create financial instability for small exporters. The central government has introduced the Niryat Rin Vikas Yojana, a new scheme that provides financial assurance to exporters and banks that lend to them. This post will provide you with a comprehensive overview of the characteristics of this new project.Â
Along with this, you’ll learn about your eligibility and the paperwork you’ll need to apply. Nirmala Sitharaman, the Union Finance Minister, has inaugurated the “NIRVIK Scheme,” which aims to provide greater insurance coverage to exporters. The Finance Minister announced the launch of the Niryat Rin Vikas Yojana while presenting the Union Budget for 2020. In the face of slowing exports, the scheme encourages exporters with high insurance coverage to invest.
Key features of NIRVIK scheme
Growth of the trade sector – The federal government’s main goal is to give the export and business sectors a much-needed boost. According to estimates, export credit will increase by 30% due to the implementation of this initiative.
Easy loan application – Exporters would be able to apply for loans from financial institutions under this scheme. The initiative also ensures that applying for business finance will be streamlined. Banks will also have an easier time disbursing the loans.
Rate of interest on loans — Any small exporter who applies for a business loan under this scheme will be charged an annual interest rate of 7.6 percent.
Principal and interest amounts covered — With the launch of this new central government scheme, small exporters will be eligible for a whopping 90 percent coverage from the central authority, both on the principal and interest sums.
Bank losses will be refunded – An essential declaration clarifies that banks will no longer be harmed by non-payment of loans. If an exporter fails to repay the credit amount, the ECGC will be responsible for refunding the banks.
Insurance premium costs are reduced – Insurance coverage is required for small and large exporters. Under the new scheme’s guidelines, the annual insurance premium has been reduced from 0.72 per cent to 0.60 per cent. This facility will only be available to a select group of exporters.
Tenure of the scheme — Once it is formally inaugurated, the minister has stated that it will run for five years.
Eligibility and Documents required for Niryat Rin Vikas Yojana
According to the scheme’s terms, only small exporters would be allowed to register for and benefit from this new centrally funded scheme, according to the scheme’s terms. An Indian citizen MUST own the business to qualify for the benefits of this scheme. The low premium rate will only apply to exporters with bank account limits of less than Rs. 80 crore, according to the scheme guidelines.Â
Whatever form of export agency it is, the owner must produce all official paperwork demonstrating that it is a real company. The GST department must supply all small exporters with the requisite registration documentation. Exporters will be unable to apply for benefits under the scheme if they do not have a PAN card issued in their name. Whether the company is controlled by a single person or is a partnership, an identification document such as an Aadhar card must be supplied to verify the claimants’ validity. If the applicants sought and obtained a bank loan, they must submit all loan-related documentation for review. If small exporters want to collect benefits, they must submit all insurance policy associated paperwork.     Â
Conclusion
In this article, we got in-depth information about the Nirvik scheme. The Union Finance Minister introduced the Nirvik Scheme to provide greater insurance coverage to exporters. All exporters will receive up to 90% insurance coverage under the NIRVIK Scheme. There are key features and eligibility criteria of the NIRVIK Scheme. They include growth of the trade sector, Easy loan application, Rate of interest on loans, Principal and interest amounts covered, Insurance premium costs are reduced, Bank losses will be refunded, tenure of the scheme, Insurance premiums are decreased, and tenure of the scheme. We also got to know who launched the Nirvik scheme?
