The new enhanced export credit risk insurance cover to support small exporters will enable them to explore new markets and buyers even while diversifying their existing product portfolio competitively.
Manoj Patodia, Chairman, Cotton Textiles Export Promotion Council (Texprocil) said the new policy would enable small exporters to avail of fund-based export credit working capital limit of up to ₹20 crore (total packaging credit and post-shipment limit per exporter/exporter-group).
“It will enable small exporters to get export credit from the banks at a lower rate of interest,” he added.
Export credit provider Export Credit Guarantee Corporation of India (ECGC) has launched this new scheme to insure up to 90 per cent of the credit risk in export finance, supporting small exporters by encouraging banks to provide more credit for export amid global economic uncertainty.
The risk cover will be provided by banks under the Export Credit Insurance for Banks Whole Turnover Packaging Credit and Post Shipment (ECIB-WTPC & PS).
By extending 90 per cent cover, small object-oriented companies are expected to get export credit at a lower rate from banks, besides other concessions. According to ECGC, the credit support extended for exports was ₹6.18-lakh crore last fiscal with over 6,700 exporters benefitting from the direct cover issued while over 9,000 exporters benefited under the Export Credit Insurance for Banks as of March-end this year. Around 96 per cent of these beneficiaries were small exporters.