TaxTMI 
TaxTMI 
TaxTMI 
Launch of Credit Assistance for E-Commerce Exporters under Export Promotion Mission (EPM) – NIRYAT PROTSAHAN.
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....es, in accordance with the coverage parameters. These facilities will also be supported through interest subvention, in accordance with the notified ceilings. 4. The intervention is being operationalised on a pilot basis through the Export-Import Bank of India (Exim Bank). The detailed Policy framework is enclosed as ANNEXURE-I. The Operational and Procedural Guidelines is enclosed at ANNEXURE-II. The governance Structure is enclosed at ANNEXURE-III 5. The intervention shall be operationalised on a pilot basis for feedback, institutional learning, and data-driven refinements. Guidelines for pilot implementation are enclosed at ANNEXURE-IV 6. The guidelines are further submitted for stakeholder feedback in accordance with Paragraph 1.07A of the Foreign Trade Policy (FTP) 2023. Stakeholders may submit comments and suggestions on the Guidelines within 30 days from the date of issuance of this Trade Notice, through email at [email protected] This is issued with the approval of the Competent Authority. B Kruti Deputy Director General of Foreign Trade (Issued from F. No. 01/02/54/AM-26/EPM) ANNEXURE-I POLICY FRAMEWORK FOR CREDIT ASSISTANCE FOR E-COMMERCE EX....
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....Direct E-Commerce Credit Facility: Credit facility shall be extended by banks/financial institutions as Cash Credit/ Overdraft facilities, subject to the following eligibility conditions: a. MSME engaged in direct e-commerce exports through postal or courier or holding inventory in ECEHs for the purpose of exports. b. MSME borrower credit account shall be a standard asset, not overdue beyond the period permitted under applicable prudential norms and shall not be classified as stressed or non-performing by the lending institution. c. Also, the account shall not have been classified as a Special Mention Account-2 (SMA-2) or a Non-Performing Asset (NPA) at any time during the two years immediately preceding the date of application for the credit facility. d. The name of company and/or its directors/ partners/ proprietors/ promotors shall not be appearing in the lending institution's defaulter list and in any of this Negative lists. e. Credit facility under this intervention may be extended only through Scheduled Commercial Banks. 2.2. Overseas Inventory E-Commerce Credit Facility: Working capital financing shall be extended by banks/fina....
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....r Direct E-Commerce Credit Facility and Overseas Inventory E-Commerce Credit Facility respectively shall be notified separately. c. The notified subvention rate and guarantee coverage shall be reviewed on a bi-annual basis and revised, where necessary, preferably in the last week of March and September of each financial year with effect from 1st April and 1st October. d. An annual ceiling shall apply to the total subvention amount, and available credit facility that a beneficiary MSME (involved in international value chains through e- commerce) may receive in a given financial year. e. Given Support shall not be admissible in respect of deemed exports, as defined under Chapter 7 of the Foreign Trade Policy or for exports to Special Economic Zones (SEZs). f. Revised interest subvention rates, guarantee coverage as notified/advised from time to time, shall be applicable only to credit facility sanctioned and disbursed on or after the date of such notification/advice. g. The responsibility for ensuring that the aggregate subvention and credit facility availed remains within the prescribed annual ceiling shall rest with the beneficiary. Any ....
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....all make an assessment of the proposal and consider sanction of a facility to the borrower. It shall then submit the application for credit guarantee to Exim Bank, along with information including firm details, exports data for last three years, account status, and financial information, through a digital application. d. Exim Bank shall assess the application based on a risk model, verify the identity, eligibility and limits, and determine whether guarantee cover can be extended for the credit facility extended to the borrower under the Scheme. Upon satisfactory assessment, Exim Bank shall advise in-principal approval to the MLI under intimation to NCGTC within three business days. NCGTC shall review the in- principle approval for conformity with the scheme guidelines, and convey approval within one business day. e. Accordingly, advice shall flow from NCGTC to the MLI regarding the guarantee fee payable on the guarantee cover issued under the Scheme. Thereafter, the MLI shall pay the guarantee fee and obtain guarantee cover number from NCGTC. **************** ANNEXURE-III GOVERNANCE STRUCTURE FOR CREDIT ASSISTANCE FOR E-COMMERCE EXPORTERS 1. Sub-Com....
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....FT(HQ) shall be responsible for operationalisation of Credit Assistance for E-Commerce Exporters including convening meetings of the Sub-Committee, implementation of required online systems, disbursement of funds. 3. Implementing Agency for Credit Assistance for E-Commerce Exporters a. Export-Import Bank of India (Exim Bank), along with National Credit Guarantee Trustee Company (NCGTC), will be the implementing agency on behalf of the Department of Commerce. A dedicated trust fund, to be termed 'E-Commerce Credit Trust' shall be seeded by the Government of India and managed by NCGTC. b. The corpus will be invested in liquid assets as per the guidelines of NCGTC, and the interest earned on the corpus and fees received from MLIs will be added back to the corpus. Exim Bank will receive 5% of the guarantee fee earned by the Fund in each financial year. c. NCGTC will receive an administration fee of 2% of the guarantee fee earned by the Fund in each financial year. ANNEXURE-X Guidelines for Member Lending Institutions (Given annexure shall not be part of the Trade Notice. This shall be issued by Exim bank separately as circular to all lending insti....
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.... so extended. l. "Intervention" means the Credit Assistance for e-Commerce Exporters. m. "Tenure of Guarantee cover" means the maximum period for which the Guarantee cover shall be valid. n. "NCGTC" means National Credit Guarantee Trustee Company Limited set up on March 28, 2014 by the Government of India to act as the Trustee to operate various Credit Guarantee Funds/Trusts, set up/to be set up by the Government of India from time to time. o. "Trust" means the E-Commerce Credit Guarantee Trust set up/to be set up by the Government of India with the purpose of guaranteeing credit facility(s), extended by the Member Lending Institution(s) to the Eligible Borrowers under this Intervention. 2. Examination of Proposals/Applications a. Identity validation, financial and non-financial assessments would be undertaken by the MLIs for MSMEs (involved in international value chains through e-commerce) as per their regular assessment. b. In case of Direct e-Commerce Credit Facility, the sanction limit shall be the lower of the Credit Limit calculated based on ECEH data and past e-commerce track record through postal/courier route; and th....
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....g the claim. In case of Direct e-Commerce Credit Facility, the remaining 20% of the payment shall be made after completion of 1 year from the settlement of first claim or completion of recovery proceedings, whichever is earlier. In case of Overseas Inventory E-Commerce Credit Facility, the remaining 20% of the payment shall be made after completion of 2 years from the settlement of first claim or completion of recovery proceedings, whichever is earlier. e. The MLI will take necessary steps for recovery of the loan as an agent of the Trust. The MLI shall first utilise the recovery proceeds to repay the Trust pro-rata to its exposure within 5 working days of effecting recovery. 4. Guarantees Under the Intervention a. Subject to the other provisions the Guarantees under the Intervention shall be provided by the Trust to MLI which has entered into the necessary agreement for this purpose with the Trust, in relation to credit facilities extended to an Eligible Borrower. 5. Credit Facilities Not Eligible The following credit facilities shall not be eligible for being guaranteed under the Intervention: a. Any credit facility in respect of which risks are addi....
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....for support under the Intervention. c. The MLI shall assess the applicant's creditworthiness using its internal evaluation mechanism and the guidelines defined by Exim Bank. d. On sanctioning the loan, the MLI shall apply for credit guarantee support to Exim Bank. Under the Direct E-Commerce Credit Facility for exporters engaged in direct exports through courier/ postal route, the guideline for MLIs is that they should obtain and provide a certificate from an independent CA confirming the exports made by the borrower through the postal or courier route during the previous two years, along with supporting documents, in the prescribed format. The credit limit may be up to 20% of the applicant's cross-border e-commerce sales (via postal or courier channels) in the previous two years, subject to a maximum cap of Rs.50 lakh. e. On receipt of application from MLI, the guarantee application will be reviewed by Exim Bank by validating UIN issued on the online portal, and assessing the application based on a risk model. Exim Bank will verify the identity, eligibility and limits. Upon satisfactory review, Exim Bank will advise in-principal approval to the MLI under....
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....the outstanding amount, including such action as may be advised by the Trust. f. The MLI shall comply with such directions as may be issued by the Trust, from time to time, for facilitating recoveries in the guaranteed account, or safeguarding the interest of the Trust as a guarantor, as the Trust may deem fit and the lending institution shall be bound to comply with such directions. g. The MLI shall, in respect of any guaranteed account, exercise the same diligence in recovering the dues, and safeguarding the interest of the Trust in all the ways open to it as it might have exercised in the normal course if no guarantee had been furnished by the Trust. The MLI shall refrain from any act of omission or commission, either before or after invocation of guarantee, which may adversely affect the interest of the Trust as the guarantor. The MLI should intimate the Trust while entering any compromise or arrangement, which may have effect of discharge or waiver of personal guarantee(s) or security. h. The MLI shall also ensure either through a stipulation in an agreement with the borrower or otherwise, that it shall not create any charge on the security held in t....
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....t turning NPA. ii) The amount due and payable to the MLI in respect of the credit facility has not been paid and the dues have been classified by the MLI as Non-Performing Assets. Provided that the MLI shall not make or be entitled to make any claim on the Trust in respect of the said credit facility if the loss in respect of the said credit facility had occurred owing to actions / decisions taken contrary to or in contravention of the guidelines issued by the Trust. iii) The credit facility has been recalled and the recovery proceedings have been initiated under due process of law. The MLI must furnish evidence to the Trust that substantive recovery steps have been taken prior to filing the claim. c. The accounts classified by the MLI as Fraud / Wilful defaulter shall not be considered eligible for Claim Settlement. d. While online lodgement of the claim, MLIs have to submit the Declaration & Undertaking electronically along with the checklist displayed in the system. e. The account slipping into NPA within 90 days from the date of issuance of first guarantee cover shall not be considered eligible for Claim Settlement. f. The c....
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....istinct and separate debts to the MLI and making payments towards any one or more of the same, after the account turning into NPA, whether the account towards which the payment is made is covered by the guarantee of the Trust or not, such payments shall, for the purpose of this clause, be deemed to have been appropriated on proportionate basis by the MLI based on total outstanding amount (including principal and accrued interest but excluding penal charges) as on the date of NPA or recovery, whichever is lower, to the debt covered by the guarantee and in respect of which a claim has been preferred and paid, irrespective of the manner of appropriation indicated by such borrower or manner in which such payments are actually appropriated. The same will be applicable for OTS settlement of such accounts. d. MLIs are required to provide an annual certificate from their Statutory Auditors in respect of remittance of recoveries made, post settlement of claims. In addition, MLIs are required to consolidate and report the actions taken for recovery and recoveries effected under the claim-settled accounts, on a quarterly basis. The report must be duly signed by an authorized official....
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....n to be binding on the MLI i. Any guarantee given by the Trust shall be governed by the provisions of the Intervention as if the same had been written in the documents evidencing such guarantee. ii. The MLI shall as far as possible ensure that the conditions of any contract relating to an account guaranteed under the Intervention are not in conflict with the provisions of the Intervention but notwithstanding any provision in any other document or contract, the MLI shall in relation to the Trust be bound by the conditions imposed under the Intervention. e. Modifications and exemptions i. The Sub-Committee on Trade Finance reserves to itself the right to modify, cancel or replace the Intervention so, however, that the rights or obligations arising out of, or accruing under a guarantee issued under the Intervention up to the date on which such modification, cancellation or replacement comes into effect, shall not be affected. ii. Notwithstanding anything contained herein, the Sub-Committee on Trade Finance shall have a right to alter the terms and conditions of the Intervention regarding an account in respect of which guarantee has not been....
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....roduct(s) a. Description b. HS Code(s) 8. Target Export Market(s) 9. Value of exports in past three financial years (in INR) 10. Value of inventory stored in overseas warehouses in past three financial years (if applicable) (in INR) 11. Instrument (Direct E-Commerce Credit Guarantee Facility/ Niryat E-Commerce Financing for Overseas Inventory) PART D: LOAN DETAILS 12. Loan Amount (in INR) 13. Estimated interest rate (in %) 14. Tenure (in days) PART C: BANK DETAILS 15. Bank Name (Select from Eligible banks and financial institutions) 16. Account Number 17. IFSC Code DECLARATION I/We hereby declare that: 1. The applicant entity is not under investigation, charged, prosecuted, debarred, or blacklisted under the Foreign Trade (Development and Regulation) Act, 1992, or under any other applicable law relating to international trade, including the Customs Act, 1962; the Central Excise Act, 1944; the Foreign Exchange Management Act, 1999; and the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974, as amended from time to time. The appl....