Export Finance & Credit Support Schemes
Interest Equalisation Scheme (IES)
Advisory Services
Reduce Export Financing Costs with Structured Interest Equalisation Advisory
Export financing is one of the largest cost components for exporters. The Interest Equalisation Scheme (IES) enables eligible exporters to reduce borrowing costs on pre-shipment and post-shipment credit — directly improving margins and cash flow.
At Shangrila Corporate Services Pvt Ltd, we help exporters identify, structure, and fully utilise interest equalisation benefits, ensuring no eligible subsidy is left unclaimed.
Reduce interest cost on export credit
Ensure correct eligibility and bank alignment
Identify missed or underutilised benefits
Overview
What is Interest Equalisation Scheme (IES)?
The Interest Equalisation Scheme is a Government of India initiative designed to support exporters by subsidising interest on export credit.
Under this scheme, exporters availing working capital finance for exports receive a specified percentage of interest equalisation through their banks. This effectively reduces the cost of borrowing and enhances competitiveness in international markets.
Unlike direct incentive schemes, IES works through the banking system, which makes correct structuring and compliance critical to fully realise its benefits.
Suitable For
Who Should Consider IES Advisory?
IES is highly relevant for exporters who rely on working capital or export credit.
Typically Beneficial For:
MSME exporters seeking cost optimisation
Merchant exporters with regular export cycles
Companies with significant export turnover and credit exposure
Key Benefits
Key Benefits of Interest Equalisation Scheme
When implemented correctly, IES can significantly improve financial efficiency:
01
Cost Reduction
Reduce your borrowing cost by 2% - 3% (as applicable).
02
Better Cash Flow
Improve your working capital efficiency.
03
Market Advantage
Enhance your export competitiveness through a lower overall cost of funds.
04
Immediate Relief
Experience a direct benefit through a reduced interest burden.
For exporters operating on tight margins, even a small reduction in financing cost can translate into substantial annual savings.
Process
How Interest Equalisation Scheme Works
Step-by-Step Process
01
Exporter avails pre-shipment or post-shipment credit from bank
02
Bank verifies eligibility under IES
03
Interest equalisation is applied on eligible loans
04
Exporter receives benefit as reduced interest cost
Common Pitfalls
Common Challenges Exporters Face
Many exporters fail to fully utilise the scheme and end up facing higher financing costs and lost subsidy benefits due to:
Lack of awareness of eligibility.
Incorrect classification under eligible sectors.
Non-alignment with bank processes.
Documentation gaps.
Missed claims or under-utilisation of available limits.
How We Help
Our Approach to IES Advisory
At Shangrila Corporate Services Pvt Ltd, our focus is not just on explaining the scheme, but on ensuring actual financial impact for clients.
Our Services Include:
Eligibility Assessment
Detailed evaluation of export profile, sector classification, and credit utilisation.
Structuring & Alignment
Advisory on aligning export credit with scheme requirements.
Bank Coordination Support
Working closely with banks to ensure correct implementation of interest equalisation.
Documentation & Compliance
Ensuring all required documentation and procedural aspects are correctly handled.
Benefit Optimisation
Identifying gaps, missed opportunities, and ensuring full utilisation of available benefits.
Documentation
Documents Required to Get Started
To fast-track your assessment, please keep the following ready:
Import Export Code (IEC)
Bank sanction letters
Export turnover details
Loan details (pre/post shipment)
MSME certificate (if applicable)
Maximise Your Export Financing Efficiency Today
Don't overpay on export credit when you are eligible for interest equalisation benefits. Get expert advisory to reduce your cost of funds and optimise export financing. Talk to our experts to:
- Check your eligibility
- Identify potential savings
- Implement benefits effectively
FAQ
Frequently Asked Questions
An interest subsidy on export credit that reduces the effective borrowing cost.
Through authorised banks as a reduction in interest charged on eligible export loans.
Not always. Proper classification, eligibility validation, and coordination are often required.
No, eligibility depends on exporter category, sector, and credit usage.
Yes, due to documentation gaps, incorrect classification, or lack of alignment with banks.
Not necessarily. A case-specific assessment is required to determine applicability.
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Why Work with
Shangrila Corporate Services Pvt Ltd
Experience in foreign trade policy and export advisory
Practical understanding of DGFT and export finance ecosystem
Execution-focused approach, including coordination with banks
Emphasis on compliance, accuracy, and benefit optimisation
We focus on ensuring that schemes translate into real financial outcomes, not just advisory reports.
Get in Touch
If you are planning to expand into global markets, structured advisory can help you utilise available support effectively.