Home › Circulars › RBI/2013-14/200

Export Credit Subvention Raised to 3% from Aug 1, 2013

No longer current — withdrawn, no replacement on file yet

Source: Reserve Bank of India · RBI/2013-14/200 · issued 26 Aug 2013 · ~2 min read

Quick answerRBI raises interest subvention on rupee export credit for eligible sectors from 2% to 3% effective August 1, 2013. Banks must cut exporter lending rates by the subvention amount, with a 7% floor. Pass full benefit to exporters.

The rule, in the simplest words

The government gives banks money to lower interest for exporters in certain job-creating sectors.
From August 1, 2013, this money (subvention) goes up from 2% to 3%.
Banks must lower the interest they charge exporters by that 3% amount.
The interest rate cannot go below 7% even after the discount.
Banks must give the full 3% benefit to exporters, not keep any part.

How it plays out — a real example

Rajesh, a trade finance manager at a public sector bank, receives the RBI circular. He updates the bank's loan system so that for eligible export credit accounts, the interest rate is automatically reduced by 3%, ensuring the rate does not fall below 7%. He then reviews existing export loans to apply the new rate from August 1, 2013, and sends a notice to exporters confirming the reduced rate.

What changed

The Government of India increased the interest subvention rate on pre- and post-shipment rupee export credit for specified employment-oriented sectors from 2% to 3%, effective August 1, 2013. Banks are directed to reduce the interest rate charged to exporters under the Base Rate system by the subvention amount, subject to a floor rate of 7%. A formal directive under the Banking Regulation Act, 1949 was issued to enforce this.

What it means for you

Banks must adjust their lending rates for eligible export credit to reflect the higher subvention, ensuring exporters pay at least 7% interest. This reduces the cost of export finance for borrowers in the covered sectors, potentially boosting export activity. Banks need to update their systems and processes to apply the new rate correctly and avoid retaining any part of the subvention.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Update loan pricing models to apply 3% subvention on eligible rupee export credit from August 1, 2013.
Ensure the interest rate charged to exporters is reduced by the subvention amount, with a floor of 7%.
Verify that the full 3% benefit is passed on to eligible exporters, with no retention by the bank.
Review existing export credit accounts to retroactively adjust interest for transactions since August 1, 2013.
Maintain documentation to demonstrate compliance with the directive and subvention pass-through.

Who it affects

Scheduled Commercial Banks, Exim Bank, Exporters in employment-oriented sectors, Branches handling export credit

❓ Common questions

Regulatory timeline

Stated effective date effective August 1, 2013
Decoded by BankPulse 2026-08-02 04:06 IST
Status change: withdrawn 03 Aug 2026, 04:00 IST

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

Which sectors are eligible for the 3% subvention?

The circular refers to 'existing sectors eligible for export credit subvention' as per earlier circulars dated January 14, 2013 and May 24, 2013. The specific list is not repeated in this notification.

Does the 7% floor apply to all export credit?

The floor rate of 7% applies to the interest rate after reducing the subvention amount, for the eligible sectors under the Base Rate system.

Is this subvention applicable to post-shipment credit as well?

Yes, the circular states the subvention applies to both pre- and post-shipment rupee export credit for the eligible sectors.

📜 Read the original circular — full text as issued by RBI

Notifications - Reserve Bank of India Skip to main content Selected Selected Change Language हिंदी Search the Website Search Home About Us ▼ About Us Organisation & Functions ▶ Organisation Structure Departments Offices Training Establishment ▶ College of Agricultural Banking Reserve Bank Staff College College of Supervisors RBI's Functions and Working Governors Deputy Governors Executive Directors Communication Policy of RBI Sources of Information ▶ Annual Publications Half-yearly Publications Quarterly Publications Monthly Publications Weekly Publications Occasional Publications SDDS NSDP Data Releases Publications available on Subscription General Information RBI History Museum ▶ The RBI Museum RBI Monetary Museum Notification ▼ Notifications Master Directions Master Circulars Amendment Directions Draft Notifications/Guidelines ▶ Draft Notifications/Guidelines Draft Directions (RE-wise) Index To RBI Circulars Standalone Circulars Circulars Withdrawn Press Releases Speeches & Media Interactions ▼ Speeches Media Interactions Memorial Lectures Podcasts Publications ▼ Biennial Annual Half-Yearly Quarterly Bi-monthly Monthly Weekly Occasional Reports Working Papers Legal Framework ▼ Act Rules Regulations Schemes Research ▼ External Research Schemes RBI Occasional Papers Working Papers RBI Bulletin History DRG Studies KLEMS State Statistics and Finances Statistics ▼ Data Releases Database on Indian Economy Public Debt Statistics Regulatory Reporting ▼ List of Returns Data Definition Validation rules/ Taxonomy List of RBI Reporting Portals FAQs of RBI Reporting Portals Home Notifications Notifications Withdrawn with effect from November 16, 2021, February 18, 2022, May 02, 2022, May 13, 2022, May 21, 2024, July 12, 2024 & October 01, 2024 ( 742 kb ) Rupee Export Credit - Interest Subvention RBI/2013-14/200 DBOD.Dir.BC.No.43 /04.02.001/2013-14 August 26, 2013 All Scheduled Commercial Banks and Exim Bank (excluding RRBs) Dear Sir/ Madam, Rupee Export Credit - Interest Subvention Please refer to our circulars DBOD.Dir.BC.No.70/04.02.001/2012-13 dated January 14, 2013 and DBOD.Dir.BC.No.94/04.02.001/2012-13 dated May 24, 2013 wherein interest subvention of 2% was extended w.e.f. 01.04.2013 to 31.03.2014 on pre and post shipment rupee export credit for certain employment oriented export sectors. 2. In this connection, the Government of India has decided to increase the rate of interest subvention on the existing sectors from the present 2% to 3% with effect from August 1, 2013. 3. Accordingly, banks may reduce the interest rate chargeable to the exporters as per Base Rate system in the existing sectors eligible for export credit subvention by the amount of subvention available subject to a floor rate of 7%. Banks may ensure to pass on the benefit of 3% interest subvention completely to the eligible exporters. 4. A directive No. DBOD.Dir.BC.No.42/04.02.01/2013-14 dated August 26, 2013 issued in this regard is enclosed. 5. All other instructions contained in our circulars dated January 14, 2013 and May 24, 2013 on the captioned subject remain unchanged. (Prakash Chandra Sahoo) Chief General Manager Encl: As above DBOD.Dir.BC.No.42 /04.02.001/2013-14 August 26, 2013 Rupee Export Credit - Interest Subvention In exercise of the powers conferred by Sections 21 and 35 A of the Banking Regulation Act, 1949, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby notifies as under: 2. It has been decided to increase the rate of interest subvention on the existing sectors eligible for export credit subvention from the present 2% to 3% with effect from August 1, 2013. 3. Banks may reduce the interest rate chargeable to the exporters as per Base Rate system in the existing sectors eligible for export credit subvention by the amount of subvention available subject to a floor rate of 7%. (B.Mahapatra) Executive Director 2026 All Months January February March April May June July August September October November December 2025 All Months January February March April May June July August September October November December 2024 All Months January February March April May June July August September October November December 2023 All Months January February March April May June July August September October November December 2022 All Months January February March April May June July August September October November December 2021 All Months January February March April May June July August September October November December 2020 All Months January February March April May June July August September October November December 2019 All Months January February March April May June July August September October November December 2018 All Months January February March April May June July August September October November December 2017 All Months January February March April May June July August September October November December Archives 2016 All Months January February March April May June July August September October November December 2015 All Months January February March April May June July August September October November December 2014 All Months January February March April May June July August September October November December 2013 All Months January February March April May June July August September October November December 2012 All Months January February March April May June July August September October November December 2011 All Months January February March April May June July August September October November December 2010 All Months January February March April May June July August September October November December 2009 All Months January February March April May June July August September October November December 2008 All Months January February March April May June July August September October November December 2007 All Months January February March April May June July August September October November December 2006 All Months January February March April May June July August September October November December 2005 All Months January February March April May June July August September October November December 2004 All Months January February March April May June July August September October November December 2003 All Months January February March April May June July August September October November December 2002 All Months January February March April May June July August September October November December 2001 All Months January February March April May June July August September October November December 2000 All Months January February March April May June July August September October November December 1999 All Months January February March April May June July August September October November December 1998 All Months January February March April May June July August September October November December 1997 All Months January February March April May June July August September October November December 1996 All Months January February March April May June July August September October November December 1995 All Months January February March April May June July August September October November December 1994 All Months January February March April May June July August September October November December 1993 All Months January February March April May June July August September October November December 1992 All Months January February March April May June July August September October November December 1991 All Months January February March April May June July August September October November December Top Back to previous page More Links : Bank Holidays Banking Glossary Citizen's Charter Complaints Contact Us COVID-19 Measures E-LMS Events FAQs Financial Education Forms IFSC/MICR Codes Important Websites Opportunities @ RBI RBI Clarifications RBI Kehta Hai RBI’s Vision and Values (1257 kb)--> Right to Information Act Tenders Follow RBI RSS Twitter YouTube Instagram Facebook LinkedIn © Reserve Bank of India. All Rights Reserved. Sitemap | Disclaimer Website owned and managed by Reserve Bank of India. Contact us on helpdoc[at]rbi[dot]org[dot]in Website last updated date: Aug 01, 2026 Supports: Google Chrome 147+ | Firefox 150+ | Microsoft Edge Version 147+ | Safari 17+ Accessibility Statement | Screen Reader and Accessibility Help

Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2013-14/200 · issued 26 Aug 2013. The plain-English explanation above is BankPulse’s own independent summary.

🧰 Tools — save, print, templates & related

Most relevant forCorporate / Wholesale Banking RM Trade Finance / Forex Operations Product Manager (Digital & Lending)Loan Operations / CPC / Disbursement Compliance Team Branch Manager — PSU / Co-op / RRB (sanctioning powers)

🛠 Banker’s toolkit — checklists & reply templates →

Related circulars · Department of Regulation

SFB Pillar 3 Disclosure Norms Aligned with Basel UCB Deposit Rate Disclosure & Uniformity Rules Updated LAB Deposit Rate Disclosure & Uniformity Rules Tightened Payments Banks: Interest Rates Must Match Disclosed Schedule RBI Updates Bulk Deposit Rate Rules and Disclosure Timing

Browse all departments →

💬 Banker Discussion

Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.

Loading comments…

BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly).
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=8341&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.