Minister of Commerce and Industry Piyush Goyal on Wednesday urged Indian banks to provide MSMEs with improved and inexpensive loans in order to meet the aim of 1 trillion dollars in product exports.

“Piyush Goyal has asked the Indian banks to ensure enhanced and affordable credit to MSMEs to achieve the target of 1 trillion dollar merchandise exports,” read the Ministry of Commerce & Industry press release. According to the official statement, the meeting was convened by the Department of Commerce in coordination with Export Credit Guarantee Corporation Limited, (ECGC) in New Delhi.

The meeting was attended by the top officials of 21 banks which included the State Bank of India, Bank of Baroda, Punjab National Bank, Canara Bank, Union Bank of India, Bank of India and Central Bank of India, said the official statement.

A presentation on ‘Export Credit and Export Credit Insurance for Banks (ECIB)’ was prepared by CMD ECGC, M Senthilnathan, it added.

According to the official statement, ECGC has now proposed additional improvements to provide adequate and affordable financing to a larger variety of MSME exporters based on its experience with the extended coverage plan.

“Based on ECGC’s experience under the scheme of enhanced cover, ECGC has now proposed further modifications to make available adequate and affordable credit to a larger section of MSME exporters, the statement said.

The product facilitates the borrower accounts to be treated equivalent to ‘AA-rated accounts with reduced cost of export credit to the exporters, it further added.

The Commerce and Industry Minister also mentioned at the meeting that the ECGC might look into expanding the programme that was proposed for nine banks to all banks in order to improve the export credit offtake for MSME Exporters, it said.

The Commerce and Industry Minister also recommended ECGC follow a pattern on similar lines to compensate for their loss for the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE), and bankers suggested that ECGC implement a claim processing technique similar to that.

The Union Minister advised the banks to take advantage of the proposed scheme and extend adequate and affordable export credit to MSME exporters. This would enable the country to achieve its target of USD 1 trillion in merchandise exports by 2030, said the statement.

The Union Minister also advised ECGC to examine 75 per cent of claim payments to banks under the ECIB scheme, within 45 days of receiving the claim, said the official statement.

The Commerce and Industry Minister further informed that in the next four months, all the ECGC services would be digitized so that physical interaction can be minimized, it added.