Import finance plays a critical role in supporting Indian businesses engaged in international trade by facilitating the purchase of goods and services from overseas suppliers. These financial instruments and services ensure liquidity, reduce transaction risks, and enhance the competitiveness of importers. A variety of import finance options are available in India to cater to diverse…
Importers in India are required to comply with a comprehensive set of guidelines governed by the Foreign Trade Policy, the Reserve Bank of India (RBI), and customs regulations. These measures ensure transparency, regulatory compliance, and the orderly conduct of foreign exchange and trade transactions. Key regulatory requirements are outlined below: 1. Import Export Code (IEC)…
The Reserve Bank of India has relaxed rules for rescheduling/restructuring of ECBs by permitting an increase in the total cost of borrowing offshore. In suppression of earlier provisions, this year the banking regulator has delegated powers to the designated AD category-I banks to allow changes/modification in the draw-down and repayment schedules notwithstanding the average maturity period or…
The Export Data Processing and Monitoring System (EDPMS) is an online platform developed by the Reserve Bank of India (RBI) in 2014 to streamline, track, and monitor export transactions in India. It serves as a centralized system, integrating information from banks and customs authorities to ensure effective oversight of export shipments and the corresponding inward…
The Reserve Bank of India relaxed rules for rescheduling/restructuring of ECBs by permitting an increase in the total cost of borrowing offshore. In suppression of earlier provisions, the banking regulator has delegated powers to the designated AD category-I banks to allow changes/modification in the draw-down and repayment schedules notwithstanding the average maturity period or changes…
With a view to providing greater flexibility for structuring of External Commercial Borrowings (ECB) arrangements, it has been decided by RBI that all recognised non-resident ECB lenders may extend loans in Indian Rupees by mobilising Indian Rupees through swaps undertaken with an Authorised Dealer Category I bank in India. At present all eligible borrowers are…
The revised guidelines on External Commercial Borrowing are as per the updated circular of RBI as of December 22, 2023. In simple terms, External Commercial Borrowings (ECB) means commercial borrowings availed (in the form of bank loans, trade credits, and securitized instruments) from external sources (from abroad) with a minimum average maturity of three years.…
The extant ECB guidelines allow the local borrower to offer security to the overseas lender / supplier for securing ECB. According to the latest directions of RBI, AD Category-I banks may allow creation of charge on immovable assets, movable assets, financial securities and issue of corporate and / or personal guarantees in favour of overseas…
Export finance plays a pivotal role in facilitating international trade by providing exporters with the necessary financial resources to manage the production, shipment, and delivery of goods and services to overseas markets. It helps bridge the time lag between incurring export-related costs and receiving payment from foreign buyers, thereby supporting liquidity and sustaining trade momentum.…
On June 27, 2019, Reserve Bank of India notified all the banks (SCBs, SBs, LABs), excluding RRBs that the RBI is receiving complaints from exporters and their Associations that the banks are not extending the benefits under the Gold Card Scheme as per extant instructions. The Central bank therefore reiterated that the instructions relating to…
