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Can an e-commerce exporter borrow Rs 5 crore against inventory sitting in an overseas warehouse?
DGFT Trade Notice 31/2025-26 backs bank credit to e-commerce MSMEs: 90% cover up to Rs 50 lakh, 75% up to Rs 5 crore on overseas stock, 2.75% subvention.
By Aaryan Kakani · · 7 min read
Key takeaways
By July 2026, 8,459 exporters had registered for the Export Promotion Mission's interest subvention. Only 140 had registered for its collateral-free credit guarantee (Business Standard, 6 July 2026, reporting figures tabled at the Board of Trade). Four months before that count, DGFT had quietly opened a second guarantee built specifically for e-commerce sellers: Trade Notice No. 31/2025-26, dated 06.03.2026 , "Credit Assistance for E-Commerce Exporters" under EPM Niryat Protsahan. It covers a bank for up to 90% of a working-capital line against domestic stock and up to 75% of a line against inventory already sitting in an Amazon FBA or third-party warehouse abroad. Almost nobody selling on a marketplace knows it exists.
90% Guarantee cover on domestic inventory credit, up to Rs 50 lakh a year (Exim Bank / DGFT / NCGTC, TN 31/2025-26)
Rs 5 Cr Cap per beneficiary per year on the overseas inventory facility, at 75% cover (Exim Bank / DGFT / NCGTC, TN 31/2025-26)
2.75% Interest subvention on eligible financing, capped at Rs 15 lakh per MSME a year (Exim Bank / DGFT / NCGTC, TN 31/2025-26)
What is the credit assistance for e-commerce exporters?
It is one of the eleven interventions under the Export Promotion Mission, the Rs 25,060 crore programme approved in November 2025. Exim Bank is the implementing agency. The National Credit Guarantee Trustee Company (NCGTC) administers a dedicated corpus, the E-Commerce Credit Trust, seeded by the Government of India, which guarantees the lending bank. The exporter does not receive money from Exim Bank or NCGTC. The exporter borrows from an ordinary participating bank, and the guarantee is what makes that bank say yes without collateral.
The scheme has three components, and an MSME can use the subvention on top of either guarantee.
| Component | What it finances | Cover | Cap per beneficiary per year |
|---|---|---|---|
| E-Commerce Credit Guarantee Facility | Domestic inventory intended for e-commerce exports | Up to 90% | Rs 50 lakh |
| Overseas Inventory E-Commerce Credit Facility | Inventory held in overseas warehouses for e-commerce sales | Up to 75% | Rs 5 crore |
| Interest subvention | Eligible financing to MSMEs in e-commerce value chains | 2.75% p.a. | Rs 15 lakh |
Source: joint Exim Bank / DGFT / NCGTC scheme flyer, citing DGFT Trade Notice No. 31/2025-26, dated 06.03.2026.
The overseas inventory line is the new idea. Every earlier export-credit instrument, from packing credit to the collateral-free Credit Guarantee Scheme for Exporters, assumes the goods leave India against an order. A marketplace seller ships stock to a foreign warehouse before any order exists and waits weeks for a payout. The 75% facility is the first government-backed line that treats that stranded stock as something a bank can lend against.
Am I eligible?
Two conditions are mandatory, one of four track-record routes must be met, and one exclusion applies. All from the same scheme flyer.
Mandatory: an active IEC and a valid Udyam registration
Both, not either. "Active" is doing real work here: an IEC whose annual April to June update was skipped is deactivated, and the UIN step below will not clear. See what keeps an IEC active. Udyam limits the scheme to MSMEs; a large-firm seller is out.
Route 1: 1+ year of domestic e-commerce, now entering exports
The only route that needs no export history at all. A seller with a year on Flipkart or Amazon.in qualifies for the domestic inventory facility before the first shipment.
Route 2: 6+ months of postal or courier export performance
This is the route most marketplace sellers already satisfy. Six months of CSB-V courier shipping bills is the evidence a bank will ask for, and it has to reconcile with realisations.
Route 3: inventory already held in overseas warehouses
FBA stock, a 3PL in New Jersey, a bonded warehouse in Dubai. This is the route into the Rs 5 crore facility, and the warehouse stock is what the bank lends against.
Route 4: stock in an E-Commerce Export Hub (ECEH) warehouse
The narrowest route today. DGFT invited proposals for the first five ECEH pilots and they are still being set up, so few sellers can use this door yet.
Exclusion: not on the Denied Entity List
A DEL entry for an unresolved export obligation or an unanswered DGFT notice blocks the scheme outright. Clear it first; the guarantee will not be issued around it.
Why does this matter to my cash flow?
India's e-commerce exports are around $5 billion a year against a government target of $200 billion by 2030 (Outlook Business, citing the Ministry of Commerce). The constraint the Ministry keeps naming is working capital: an FBA seller pays for goods, freight, destination duty and 60 to 90 days of warehouse dwell before the first settlement lands. That money has traditionally come from the seller's own pocket or an unsecured loan at 14 to 18%.
Example: apparel seller, Rs 2 crore of FBA stock in the US
| Line | Without the scheme | With the scheme |
|---|---|---|
| Bank's exposure on a Rs 2 crore line | Rs 2 crore, secured on property or refused | Rs 50 lakh after 75% NCGTC cover |
| Interest at an illustrative 11% p.a. | Rs 22 lakh a year | Rs 22 lakh, less Rs 5.5 lakh subvention = Rs 16.5 lakh |
| Effective rate to the exporter | 11% | 8.25% |
| Subvention cap check | Rs 5.5 lakh, inside the Rs 15 lakh ceiling |
The 11% is an illustration, not a scheme rate. The bank prices the loan; the scheme only changes who carries the loss if it goes bad and who pays 2.75 points of the interest. The Rs 15 lakh cap bites at roughly Rs 5.45 crore of subvented borrowing, which is above the Rs 5 crore facility cap, so on this facility the ceiling is unlikely to bind.
Do not confuse this with the two guarantees banks already quote. The comparison exporters keep getting wrong:
| Guarantee | Who it is for | Cover | Lends against |
|---|---|---|---|
| E-commerce facility (TN 31/2025-26) | MSME e-commerce exporters, Udyam-registered | 90% domestic / 75% overseas | Inventory, including stock already abroad |
| Credit Guarantee Scheme for Exporters (EPM) | Any MSME exporter, order-based credit | 85% micro and small / 65% medium | Pre- and post-shipment credit against orders |
| ECGC cover to the bank | All exporters, via the bank's policy | Bank-level, up to 90% under NIRVIK | Buyer and country default on shipped goods |
CGSE cover percentages as reported by Business Standard, 6 July 2026. ECGC per export credit insurance.
How do I actually apply?
The flyer gives four steps. The order matters, because the UIN comes before the bank, not after.
- 01 Generate a UIN on dgft.gov.in. File the request with firm, export, account and financial details. The Unique Identity Number is the scheme's handle for you, and it is what you carry to the bank.
- 02 The bank evaluates and submits to Exim Bank. If the bank is willing to lend, it files the credit guarantee application digitally with Exim Bank. A bank that is not willing stops here; the scheme cannot force it.
- 03 Exim Bank and NCGTC assess eligibility for the proposed facility and approve the guarantee.
- 04 Guarantee cover is issued. The bank then processes and disburses under its own procedures, so the sanction letter, drawing power and margin are the bank's terms, not the scheme's.
What does the flyer not tell you?
Four things, all of which change the price or the timing.
There is a guarantee fee, and the bank may pass it on
Legal analyses of the Exim Bank guidelines (Mondaq and IndiaLaw, both March 2026) report a guarantee fee of 0.5% p.a. on the domestic facility and 1.0% p.a. on the overseas inventory facility, with a maximum tenure of 365 days . Neither figure is on the flyer. Ask the bank in writing whether the fee is absorbed or added to your rate, because 1.0% claws back more than a third of the 2.75% subvention.
The rates are reviewed twice a year
The same analyses report that subvention rates and cover levels are subject to bi-annual review by the Sub-Committee on Trade Finance, effective 1 April and 1 October. A sanction in September may be priced differently from one in November. Get the applicable rate written into the sanction letter.
The guarantee protects the bank, not you
If the stock does not sell and the loan defaults, NCGTC pays the bank its 75% or 90%. The bank still pursues you for the whole amount. The scheme lowers the bank's risk so it will lend; it does not lower yours.
Six months of courier exports must reconcile
Route 2 is proven with shipping bills and the realisations against them. Sellers whose CSB-V bills sit unmatched in EDPMS because marketplace payouts were never linked to them will find the bank's credit team reading that as unrealised exports. Clean the ledger before applying.
What should you do first?
Start with the eligibility check, not the bank. Confirm the IEC is active, pull the Udyam certificate, and search the DGFT portal for a DEL entry. Then decide which route you are on: a year of domestic marketplace sales, six months of courier exports, or stock already abroad. Only then generate the UIN.
The document the bank will lean on hardest is the reconciliation between your CSB-V shipping bills and your marketplace payouts. That is exactly the ledger Seasaw builds from your Amazon, Etsy or Shopify settlements and your ICEGATE filings, so that six months of courier exports show up as six months of realised exports rather than six months of open EDPMS entries.
For the deeper reading: the Export Promotion Mission for how the eleven interventions fit together, interest subvention for how the 2.75% reaches your loan account, and the bank comparison for which banks already handle marketplace remittances without friction. Those are the banks most likely to say yes at Step 2.
Sources & citations
- Joint Exim Bank / DGFT / NCGTC scheme flyer, "Credit Assistance for E-Commerce Exporters", citing DGFT Trade Notice No. 31/2025-26, dated 06.03.2026 (cover percentages, caps, eligibility, application steps). Exim Bank press release on EPM guidelines (implementing agency, E-Commerce Credit Trust). Business Standard, 6 July 2026 (140 vs 8,459 registrations; CGSE cover percentages).
- DGFT Trade Notice No. 13/2026-27, dated 14.07.2026 (UIN timing for interest subvention). Mondaq and IndiaLaw, March 2026 (guarantee fee, tenure, bi-annual review; not verified against the guidelines text). Outlook Business, citing Ministry of Commerce ($5 billion current e-commerce exports, $200 billion 2030 target). Union Cabinet approval of EPM, November 2025 (Rs 25,060 crore outlay).
- This is general information, not financial or legal advice. Confirm terms with your bank before drawing on any facility. Last verified: September 2026.
Update history
- First published.