The government is framing schemes for MSME exporters to provide credit at easy terms, promote alternate financing instrument through strengthening factoring services for them, and offer assistance to deal with non-tariff measures imposed by other countries, an official said on Tuesday. The commerce, MSME and finance ministries are working on these schemes, Director General of Foreign Trade (DGFT) Santosh Kumar Sarangi said.
These schemes are being formulated under the export promotion mission, announced in the Union Budget for 2025-26. The schemes are expected to be rolled out in about 4-5 months, he said. The government on February 1 announced the setting up of an Export Promotion Mission with an outlay of Rs 2,250 crore to promote the country’s outbound shipments.
Finance Minister Nirmala Sitharaman has said through the mission, the government will facilitate exporters to get easy access to credit, cross-border factoring support, and support MSMEs to tackle non-tariff measures in overseas markets. Sarangi said that promoting factoring services would help reduce the dependence of exporters on banks.
Export factoring services, a widely used financing instrument globally, have low adoption in India due to high factoring costs involving higher rates of interest, higher risk premiums and lack of parity with subvention schemes. The cross-border factoring should attain a certain scale to reach about 3 per cent of merchandise exports (in line with the global average).
