Interest Subvention Scheme for Pre- and Post-Shipment Export Credit

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Dated: 05.01.2026

Interest Subvention Scheme for Pre- and Post-Shipment Export Credit

Exporters play a crucial role in driving economic growth and contributing to global trade. To support exporters, especially Micro, Small, and Medium Enterprises (MSMEs), the Government of India has introduced the Interest Subvention for Pre- and Post-Shipment Export Credit scheme under the Export Promotion Mission (EPM) and NIRYAT PROTHSAHAN initiative. This scheme aims to reduce the interest burden on export credit, enhance liquidity, and improve the competitiveness of Indian exporters in the global market.

What is the Interest Subvention Scheme?

The Interest Subvention Scheme is a financial relief initiative for MSME exporters, offering a transparent and rules-based mechanism to reduce the cost of export credit. It focuses on pre- and post-shipment rupee export credit and is not linked to export performance, pricing, or quantities exported, ensuring fair support for all eligible exporters.

Key Features of the Scheme

Interest Subvention Rate: MSME exporters can avail of an interest subvention at the rate of 2.75% per annum on pre-shipment and post-shipment rupee export credit.
Annual Subvention Cap: Each MSME exporter is eligible for a maximum subvention benefit of ₹50 lakh per financial year.
Eligibility: The scheme applies to MSME manufacturer exporters and merchant exporters under a notified positive list of Harmonized System of Nomenclature (HSN) six-digit tariff lines.
Lending Institutions: Export credit must be extended by lending institutions in compliance with the Reserve Bank of India’s (RBI) Master Directions on Pre- and Post-Shipment Export Credit.
Positive List of Tariff Lines: The scheme covers exports under a positive list of eligible HSN six-digit tariff lines, reviewed periodically based on sectoral MSME concentration and export concentration ratios.

Eligibility Criteria

To qualify for the Interest Subvention Scheme, MSME exporters must:

Hold a valid active Importer-Exporter Code (IEC) and MSME Udyam Registration Number.
Avail export credit strictly for eligible tariff lines.
File an online declaration of intent to avail interest subvention on the DGFT portal, which generates a Unique Identification Number (UIN) linked to the exporter’s bank account.

Step-by-Step Procedure to Apply for Interest Subvention 

Log in to the Online Portal: Access the designated online portal using your credentials and ensure your profile is updated.
Access the Services Tab: Navigate to the “Services” tab on the portal.
Select Export Promotion Mission (EPM): Choose the “Export Promotion Mission (EPM)” option to access relevant schemes.
Apply for EPM Schemes: Click on “Apply for EPM Schemes” to proceed.
Start a Fresh Application: Initiate a new application by selecting “Start Fresh Application.”
Select Application Type: Choose “Interest Subvention for Pre- and Post-Shipment Export Credit” and click “Save & Proceed.”
Fill in the Application Form: Provide detailed information about your organization, including:
- Basic details (e.g., IEC Number, PAN, Firm Name, Applicant’s Name, Contact Information).
- Address details (e.g., branch address, pin code, city, state).
- MSME details (e.g., registration number, product details).
- Annual turnover and export turnover for the last three financial years.
- Other details (e.g., number of employees, SC/ST or women ownership, location in Northeastern or hilly states).
- Bank details (e.g., account number, IFSC code, bank name).
- Loan details (e.g., loan amount, type of loan, tenure, interest rate).
- Item details (e.g., sector, HSN code, product description, country of export).
- Attachments (e.g., supporting documents in PDF or JPG format, maximum 5 attachments of up to 5 MB each).
- Declaration (e.g., compliance with regulations, truthful information, and agreement to maintain accurate records).
Submit the Application: Review the application thoroughly and click “Save & Proceed” to submit.

Implementation Framework

The scheme is operationalized through the RBI, which reimburses interest subvention claims submitted by lending institutions. The subvention benefit is passed on upfront to eligible MSME exporters by the lending institutions, with funds disbursed monthly through a revolving fund system.

Benefits for MSME Exporters 

Cost Reduction: Lower interest rates on export credit reduce the financial burden on MSMEs.
Enhanced Liquidity: Improved cash flow enables exporters to meet working capital needs efficiently.
Support for New Markets: Encourages MSMEs to diversify and expand into new geographies.

Key Notes for Applicants

Ensure your bank account is validated in your IEC profile.
Only one sector can be selected per application.
Maintain accurate records of export transactions and monitor subvention amounts to ensure compliance.

Conclusion

The Interest Subvention for Pre- and Post-Shipment Export Credit scheme is a valuable initiative for MSME exporters, providing financial assistance to reduce interest burdens and enhance global competitiveness. By following the outlined steps and adhering to the eligibility criteria, exporters can successfully apply for this scheme and benefit from its offerings. This initiative aligns with the government’s vision of promoting exports and strengthening the backbone of the Indian economy.

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Source: DGFT

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