Last Updated: October 27, 2026 by Pratham Agarwal, Rasp International
The short answer
Collateral Support for Export Credit lets a bank lend export working capital to a Micro, Small or Medium Enterprise (MSME) exporter with little or no collateral. The Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) covers the bank for up to 85 percent of the loan (micro and small) or 65 percent (medium), within Rs 10 crore per borrower, under Directorate General of Foreign Trade (DGFT) Trade Notice 21/2025-26 dated 2 January 2026.
The rule that decides everything: file the intent on the DGFT portal and get your Unique Identification Number (UIN) before you apply to the bank. CGTMSE issues the cover only after it validates that UIN, under Trade Notice 21/2025-26 Appendix-A paras 4(a) and 5(c).
Verified as on 27 October 2026 against DGFT Trade Notice 21/2025-26 dated 2 January 2026, DGFT Trade Notice 29/2026-27 dated 1 October 2026, CGTMSE Circulars No. 257/2025-26 dated 6 February 2026 and No. 258/2025-26 dated 10 February 2026 and the DGFT Export Promotion Mission (EPM) Exporter User Manual version 1.0 (January 2026). Written by Pratham Agarwal, Founder, Rasp International.
85%
cover for micro and small exporters, Trade Notice 21/2025-26 Appendix-A para 3(a)(i)
65%
cover for medium exporters, Appendix-A para 3(a)(ii)
Rs 10 crore
ceiling per borrower across all CGTMSE schemes, Appendix-A para 3(b)
0.37 to 1.2%
standard annual fee by loan slab, Appendix-A para 7(a)
| Scheme | Collateral Support for Export Credit (a Special Credit Guarantee Scheme in CGTMSE Circular No. 257/2025-26) |
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| Part of | Export Promotion Mission (EPM), Niryat Protsahan |
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| Run by | EPM Section of DGFT; CGTMSE implements (Appendix-A para 2(a)) |
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| Legal basis | DGFT Trade Notice 21/2025-26, draft Foreign Trade Policy (FTP) and Handbook of Procedures (HBP) text; CGTMSE Circular No. 257/2025-26 for lenders |
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| Who it is for | MSME manufacturer and merchant exporters with an active Importer Exporter Code (IEC) and Udyam registration |
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| What you get | Cover to your bank on pre-shipment and post-shipment export credit |
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| Cap | Rs 10 crore per borrower with other CGTMSE cover, printed for financial year (FY) 2025-26 (para 2(ii)) |
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| Validity or window | Pilot launched by Trade Notice 21/2025-26 on 2 January 2026, no end date in the notice; each intent valid to FY end (Appendix-A para 4(d)) |
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| Where you apply | Intent on the DGFT portal; the bank applies to CGTMSE |
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Why this page exists
Collateral Support for Export Credit is often sold as a collateral free export loan, but the official texts differ. Draft HBP para X.2 in Trade Notice 21/2025-26 covers loans with “limited collateral security”. CGTMSE Circular No. 257/2025-26, addressed to lenders, covers loans without collateral and allows collateral on part of a loan under a hybrid model. And the exporter never claims from CGTMSE. The bank does.
Rasp International is an ISO 9001:2015 certified export and import (EXIM) and DGFT advisory firm founded in 2019 that has served 500 plus exporters. This page shows what the exporter and the bank each do.
What Collateral Support for Export Credit is
Collateral Support for Export Credit is a credit cover scheme that protects a bank against part of its loss on export working capital lent to MSME exporters who lack collateral, run by DGFT with CGTMSE under the Export Promotion Mission, Niryat Protsahan. The cover goes to the bank, not the exporter. CGTMSE checks the UIN through a system link with the DGFT portal, but CGTMSE Circular No. 257/2025-26 puts the check of the UIN, the exporter’s eligibility and the link between the UIN and the sanctioned loan solely on the bank.
Niryat Protsahan, the finance arm of the Export Promotion Mission, also holds interest subvention on export credit, export factoring support, credit for e-commerce exporters and support for emerging export markets. Trade Notice 29/2026-27 dated 1 October 2026 applies one revised Sub-Committee on Trade Finance to all of them, with CGTMSE, the Export-Import Bank of India (Exim Bank) and the National Credit Guarantee Trustee Company (NCGTC) as members.
What you get
| Item | Micro and small exporters | Medium exporters |
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| Cover on the export loan | 85 percent: 75 percent CGTMSE plus 10 percent DGFT funds (Appendix-A para 3(a)(i)) | 65 percent, all from the EPM corpus, as CGTMSE does not cover medium units (para 3(a)(ii)) |
| Other CGTMSE cover | Comes in addition, not in its place (draft HBP para X.4(a)) | Cover only under this scheme (draft HBP para X.4(a)) |
| Ceiling | Rs 10 crore, all CGTMSE schemes counted together (paras 3(b) and 3(d)) | Rs 10 crore (para 3(a)(ii)) |
| Loans covered | Pre-shipment and post-shipment export credit (draft FTP para X.2(b)) | The same |
| Not covered | Domestic working capital (draft HBP para X.2), goods off Annexure-II (para X.1(c)) and exposure over Rs 10 crore (para 3(d)) | The same |
| Who pays the fee | The bank pays CGTMSE and may recover it from the exporter at its discretion (para 8(g)) | The same |
The annual fee follows the CGTMSE Credit Guarantee Scheme for Banks (CGS-I). Appendix-A para 7(a) sets standard rates from 0.37 percent up to Rs 10 lakh to 1.20 percent above Rs 8 crore. A well rated bank pays 10 percent less, a high risk bank up to 70 percent more and a newly registered lender 70 percent more for at least a year (paras 7(b) and 7(c)).
Illustrative example: a small exporter has Rs 2 crore of CGTMSE cover on a machinery loan, so Appendix-A para 3(d) leaves Rs 8 crore. If Rs 1 crore of packing credit (a pre-shipment export loan) later fails, the bank’s cover is capped at 85 percent (para 3(c)), and the exporter still owes the full amount (para 6(e)).
Who can apply and who cannot
Who can apply
MSME manufacturer exporters
A valid active IEC and Udyam registration (draft HBP para X.1(a)).
Merchant exporters
Exporting traders, on the same conditions (para X.1(a)).
Medium enterprises
Eligible at 65 percent cover (Appendix-A para 3(a)(ii)).
Goods on the positive list
A six-digit Harmonised System (HS) code listed in Annexure-II (para X.1(c)).
Who cannot, or should check first
- Borrowers seeking domestic working capital (draft HBP para X.2).
- Goods outside Annexure-II, which has no Chapter 72 (iron and steel) line; the Chapter 72 lines in Trade Notice 01/2026-27 are for interest subvention only.
- Services exporters (para 2(iv) speaks of merchandise exports).
- Units that have availed or are availing Production Linked Incentive (PLI) benefits (declaration item 6, Annexure-IV).
- A unit with a suspended or cancelled IEC (Appendix-A para 4(c)(i)), or linked through its directors or partners to an entity on the DGFT Denied Entity List (DEL) (declaration item 1(b)).
Documents that get it through
| Document | What the authority checks | The mismatch that brings a query or rejection |
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| IEC | Valid, not suspended or cancelled (Appendix-A para 4(c)(i)) | Profile not updated in ANF-1 (the online IEC profile), which the form asks you to declare |
| Udyam certificate | Valid and linked to the IEC (para 4(c)(ii)) | Not linked to the IEC, so the form cannot pull the MSME details from the IEC (User Manual section 5) |
| Chartered accountant (CA) certificate | Revenue and export turnover for the past three years (para 4(c)(iii)) | Figures that differ from the turnover typed into the form |
| Export purchase order, self-attested | A real export order (para 4(c)(iv)) | Goods outside Annexure-II, or a second sector in one application |
| Bank account | Validated in the IEC profile at a lender on Annexure-III (Annexure-IV bank details notes) | The bank is missing from the form: account not validated |
| Loan details | Amount, tenure and estimated rate; the bank links the UIN to the sanction (Circular No. 257/2025-26) | A sanction from another bank or for another facility than the intent names |
| Declaration | Penalty history, DEL links, PLI and the Rs 10 crore undertaking (declaration items 1, 6 and 7) | CGTMSE cover across lenders above Rs 10 crore (items 7 and 8) |
| Attachments and e-sign | Five pdf or jpg files of 5 MB at most (Annexure-IV); a Digital Signature Certificate (DSC) or Aadhaar e-sign (User Manual) | No active DSC or e-sign for a member of the firm |
If the IEC needs work first, see our IEC registration guide.
How to apply, stage by stage
The exporter files the DGFT intent; the bank decides the loan and applies to CGTMSE for the cover.Before you apply
1
Check the product line
Find each six-digit HS code you export in Annexure-II.
2
Clean up the IEC profile
An active IEC off the DEL, Udyam linked and the account validated at your chosen bank (User Manual section 4; Appendix-A para 4(c)).
3
Count existing CGTMSE cover
Ask each bank for the CGTMSE cover on your loans; the Rs 10 crore ceiling is shared (Appendix-A para 3(d)).
Filing the intent
4
Open the application
On the DGFT portal: Services, Export Promotion Mission (EPM), Apply for EPM Schemes, Start Fresh Application, Collateral Support for Export Credit (Annexure-IV).
5
Fill the form
Enter branch, three years of turnover, bank, loan amount and tenure, and items by ITC (HS) code (Indian Trade Classification) and country. Upload the CA certificate and order.
6
Sign, pay and save the UIN
Accept the declaration, e-sign and pay the Rs 200 shown in the DGFT Exporter User Manual. The UIN is in the acknowledgement letter.
After filing
7
Take the UIN to the bank
The bank judges creditworthiness its own way (Appendix-A para 5(a)).
8
The bank applies to CGTMSE
CGTMSE validates the UIN, allots a CGPAN (CGTMSE’s reference number for the cover) and invoices the fee. Cover issues on payment (para 5).
9
The bank keeps the cover alive
First fee within 30 days of the demand advice; renewal by 30 March each year (Appendix-A paras 8(a) and 8(b)).
The lapse rule. Each intent is valid until the end of the financial year, 31 March (Appendix-A para 4(d)). The cover lapses if the bank pays the fee late (para 8(d)); revival needs a request within the next financial year, a standard account, penal interest at 4 percent over Bank Rate and an extra 15 percent risk premium (para 9).
Your bank wants collateral you do not have
We can prepare and file your DGFT intent in your unit’s own name before you go to the bank.
Where applications go wrong
| Failure | What you see | What actually broke |
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| Loan applied for before the intent | The bank may not attach the cover | Appendix-A para 4(a) wants the intent first, and CGTMSE validates the UIN before cover (para 5(c)) |
| HS code not on Annexure-II | No cover for that product | Cover is only for the positive list (draft HBP para X.1(c); declaration item 2(k)) |
| Old CGTMSE cover forgotten | Less cover than the loan needs | Appendix-A para 3(d) counts all CGTMSE schemes inside Rs 10 crore |
| An outside guarantor signs | The loan may fall outside the cover | Circular No. 257/2025-26 covers loans without an outside guarantor; Circular No. 258/2025-26 says proprietors, partners and promoter directors are not outsiders |
| Bank misses the renewal fee | The cover lapses | Appendix-A para 8(d); revival under para 9 costs penal interest |
How it fits with other schemes
| Scheme | What it does | How it sits with Collateral Support |
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| EPM interest subvention | 2.75 percent a year on rupee export credit, up to Rs 50 lakh per FY (Trade Notice 20/2025-26 para 2) | A separate DGFT application. Neither notice says if both fit one loan, so check with the lending bank |
| Credit Guarantee Scheme for Exporters (CGSE) | 100 percent NCGTC cover on extra credit up to 20 percent of the export limit held on 30 September 2025, up to Rs 50 crore (NCGTC FAQs, 1 December 2025) | A separate Finance Ministry scheme, open till 31 March 2026 or Rs 20,000 crore, per the Press Information Bureau (PIB) release of 1 January 2026 |
| CGTMSE CGS-I | Regular CGTMSE cover on loans to micro and small units | Shares the Rs 10 crore ceiling (para 3(b)) |
| Credit Assistance for E-Commerce Exporters | NCGTC trust cover on e-commerce export credit (Trade Notice 31/2025-26) | Exim Bank lender guidelines para 5(b) exclude a facility that already has cover under any other scheme |
Export factoring under Support for Alternative Trade Instruments (Trade Notice 25/2025-26) and Support for Emerging Export Opportunities (Trade Notice 32/2025-26) work on receivables and letters of credit, not on your loan. Our Export Promotion Mission guide compares the CGSE and Collateral Support. For buyer payment risk, see trade finance and Export Credit Guarantee Corporation of India (ECGC) cover.
What Collateral Support for Export Credit will not do
1
It will not make the bank lend
The bank decides under Appendix-A para 5(a). A UIN shows intent. It is not a sanction.
2
It will not cut what you owe
The bank still recovers the full amount after a claim (para 6(e)), and CGTMSE may list defaulters on its website (para 6(i)).
3
It will not stretch past its limits
Nothing above Rs 10 crore (Appendix-A para 3(d)), on domestic working capital or on goods outside Annexure-II.
How Rasp International handles Collateral Support for Export Credit
When a client engages us, we prepare and file the DGFT intent end to end, always in the client unit’s own name; clients who prefer to file themselves can do so with our guidance. The loan and the CGTMSE application stay with the bank.
We sign a non-disclosure agreement (NDA) and a service level agreement (SLA) with every client. The client and Rasp both hold the portal logins, kept safe and confidential, and documents sit in encrypted storage. We give an authority letter only when a client asks. We hold no customs broker (CHA) licence; licensed CHA partners across India handle customs clearance. See how we work.
Planning an export loan with little collateral
Send us your products, your bank and your current CGTMSE loans. We will tell you what the DGFT intent needs.
What Is Not Yet Notified, Checked on 27 October 2026
- The FY 2026-27 ceiling. Trade Notice 21/2025-26 para 2(ii) ties Rs 10 crore to FY 2025-26, while Appendix-A para 3(b) and CGTMSE Circular No. 257/2025-26 state Rs 10 crore with no year. Check with the EPM Section of DGFT.
- Limited collateral or none. DGFT says limited, CGTMSE says none with a hybrid option. Check with the lending bank which model it uses.
- UIN validity. Appendix-A para 4(d) says to the end of the financial year; the User Manual says one year from generation. Check with the EPM Section of DGFT.
- A loan already applied for. The form has an optional loan reference field, yet para 4(a) wants the intent first. Check with the lending bank.
- List size. The Annexure-II heading says 4,139 lines; the table runs to 4,185 rows. Check with the EPM Section of DGFT if your code is missing.
- The CGSE after 31 March 2026. No official extension found. Check with NCGTC or your lending bank.
Frequently asked questions
What is Collateral Support for Export Credit?
It is an Export Promotion Mission scheme in which CGTMSE covers part of a bank’s loss on export working capital lent to MSME exporters short of collateral: 85 percent for micro and small units and 65 percent for medium units, under DGFT Trade Notice 21/2025-26.
Is a collateral free export loan really free of collateral?
Not always. CGTMSE Circular No. 257/2025-26 covers export loans without collateral, but its hybrid model lets the bank take collateral on part of the loan and cover the rest. DGFT’s draft text speaks of limited collateral. Ask your bank which model it will use.
How much of the export loan does CGTMSE cover?
Under Trade Notice 21/2025-26 Appendix-A para 3(a), micro and small exporters get 85 percent: 75 percent from CGTMSE and 10 percent from DGFT funds. Medium exporters get 65 percent under the same para, paid from the EPM corpus. The cover protects the bank, not the borrower.
Does existing CGTMSE cover on my other loans count against the Rs 10 crore limit?
Yes. Appendix-A para 3(b) of Trade Notice 21/2025-26 sets Rs 10 crore per borrower, including cover under all CGTMSE schemes. In the notice’s example, a borrower with Rs 2 crore of existing CGTMSE cover can get Rs 8 crore more at most. Ask each bank for its figure.
Can a medium enterprise get collateral support for export credit?
Yes, at 65 percent cover. CGTMSE does not cover medium enterprises in its regular schemes, so Appendix-A para 3(a)(ii) of Trade Notice 21/2025-26 pays a medium unit’s claim wholly from the EPM corpus. Draft HBP para X.4(a) gives medium exporters this cover only under this scheme.
Who pays the CGTMSE fee on a covered export loan?
The bank pays CGTMSE an annual fee at CGS-I rates, 0.37 to 1.20 percent standard by slab under Appendix-A para 7(a) of Trade Notice 21/2025-26. Para 8(g) lets the bank recover it from the exporter at its discretion. Ask before sanction whether it will pass the fee on.
Which banks give collateral support for export credit?
Lenders registered with CGTMSE. Annexure-III of Trade Notice 21/2025-26, updated to 30 November 2025, lists 12 public sector banks, 22 private sector banks, 7 foreign banks and 10 other lending institutions, Exim Bank among them. The account must be validated in your IEC profile.
Do I apply to DGFT or to CGTMSE for the cover?
You file only on the DGFT portal. The intent gives you a UIN, which you take to the bank. After sanction, the bank applies to CGTMSE, which validates the UIN and issues the cover to the bank, under Appendix-A paras 4 and 5 of Trade Notice 21/2025-26.
Can I take interest subvention and collateral support on the same loan?
The notices do not say. Interest subvention under Trade Notice 20/2025-26 and Collateral Support under Trade Notice 21/2025-26 are separate application types on the DGFT portal, and neither notice bars or allows both on one facility. Check with the lending bank.
What is the difference between CGSE and collateral support?
The Credit Guarantee Scheme for Exporters is a Finance Ministry scheme run by NCGTC that, per its FAQs, gave 100 percent cover on extra credit of up to 20 percent of an existing export limit, open till 31 March 2026 per PIB. Collateral Support is an EPM scheme run through CGTMSE.
How long is the UIN for collateral support valid?
Appendix-A para 4(d) of Trade Notice 21/2025-26 says each intent is valid until the end of the financial year, 31 March. The DGFT Exporter User Manual says one year from generation. The two differ, so check with the EPM Section of DGFT before relying on a UIN for a loan running past 31 March.
If my export loan goes bad, does the cover cut what I owe?
No. Appendix-A para 6(e) of Trade Notice 21/2025-26 says a claim paid to the bank does not remove its duty to recover the full amount from the borrower. Para 6(i) also lets CGTMSE list defaulted borrowers on its website. The cover lowers the bank’s risk, not your debt.
Sources
- Tier 1. DGFT Trade Notice 21/2025-26 dated 2 January 2026 with Annexures I to IV: content.dgft.gov.in.
- Tier 1. DGFT Trade Notice 29/2026-27 dated 1 October 2026: content.dgft.gov.in.
- Tier 1. CGTMSE Circular No. 257/2025-26 dated 6 February 2026: cgtmse.in; Circular No. 258/2025-26 dated 10 February 2026: cgtmse.in.
- Tier 1. DGFT EPM Exporter User Manual version 1.0, January 2026: DGFT portal.
- Tier 1. DGFT Trade Notice 20/2025-26 dated 2 January 2026: content.dgft.gov.in; Trade Notice 01/2026-27 dated 20 April 2026: content.dgft.gov.in; Trade Notices 25/2025-26, 31/2025-26 and 32/2025-26: DGFT trade notices.
- Tier 1. Exim Bank lender guidelines, Credit Assistance for E-Commerce Exporters: eximbankindia.in.
- Tier 1. NCGTC CGSE FAQs, 1 December 2025: ncgtc.in; PIB release, 1 January 2026: pib.gov.in.
This is general guidance. Rules change. Check the current notification or trade notice, or speak to us, before you act.
Related: Export Promotion Mission schemes | EPM interest subvention on export credit | every EPM scheme and trade notice