*( Ref: RBI Circular No. RBI/2025-26/96/DOR.STR.REC.60/21.04.048/2025-26 dated November 14, 2025)
The Reserve Bank of India has issued the RBI (Trade Relief Measures) Directions, 2025 to ease debt-servicing pressures for export-oriented borrowers affected by global trade disruptions. The framework, which applies with immediate effect, enables regulated entities to offer (i) a time-bound moratorium or deferment on repayments, and (ii) relaxed repayment norms for export credit—including both pre-shipment and post-shipment finance—under a Board-approved policy.
Scope and Applicability
* The Directions apply to all regulated lenders, who must adopt a Board-approved policy specifying objective, transparent eligibility criteria.
* Relief can be extended only where borrowers demonstrate direct impact from global trade-related disruptions, balancing the need for support with prudential discipline.
* Measures are discretionary, designed to protect the continuity of viable businesses rather than offering blanket forbearance.
1. Moratorium and Working Capital Relief
1.1 Moratorium Window on Term Loans and Working Capital Interest
Eligible borrowers may receive a repayment moratorium/deferment for instalments on term loans and interest on working capital facilities falling due between 1 September 2025 and 31 December 2025, providing a four-month liquidity buffer without triggering adverse credit consequences.
1.2 Working Capital Recalibration
Lenders may reassess drawing power, including temporary relaxation of margins or recalculation of limits, enabling borrowers to draw against **lower stock/receivable levels** during the disruption period.
2. Relaxation in Repayment of Export Credit
2.1 Extended Repayment Period for Export Credit
Pre-shipment and post-shipment export credit disbursed up to 31 March 2026 may be allowed an extended repayment period of up to 450 days, aligning loan tenors with longer cash-conversion cycles caused by delayed shipments and remittances.
2.2 Flexibility for Packing Credit Liquidation
For packing credit sanctioned on or before 31 August 2025, where goods could not be exported, lenders may permit liquidation from legitimate alternate sources, including domestic sale proceeds or substitution using another export order. This avoids penal classification where non-dispatch arises purely from trade disruption.
3. Prudential and Credit-Reporting Treatment
* Relief granted under these Directions will not by itself trigger an asset-classification downgrade, provided compliance with stipulated conditions and lender policy.
* Regulated entities may be required to maintain specific provisions (e.g., around 5% on outstanding exposure under relief) to safeguard prudential soundness.
4. Borrower Preparedness and Documentation
* Evidence of disruption: Borrowers should compile documentation such as shipment delays, order cancellations, freight bottlenecks, and buyer deferrals to meet eligibility criteria.
* Facility alignment: Loan documentation must be updated to reflect moratorium periods, revised interest accruals, recalculated drawing power, and new repayment schedules for export credit within permitted outer limits.
5. Implementation Steps for Banks
* Board-approved policy: Define impacted sectors, eligibility norms, due-diligence requirements, provisioning policy, and borrower communication templates. Publish the policy in the public domain.
* Portfolio management: Tag eligible accounts, automate moratorium accruals, update DP calculations, align export bill timelines with FEMA requirements, and schedule post-moratorium step-up plans to avoid a repayment cliff in January 2026.
Key Takeaway
The RBI (Trade Relief Measures) Directions, 2025 provide a targeted, time-bound relief package for borrowers affected by global trade headwinds—comprising a moratorium window, working-capital flexibility, and extended export-credit repayment. The framework balances borrower support with prudential discipline through policy-based eligibility, documentation standards, and calibrated provisioning.
What Banks Should Do Now — Quick Checklist
1. Approve & Publish Policy
* Finalise the Board-approved policy incorporating eligibility criteria, documentation standards, and relief parameters.
* Publish the policy on the bank’s website as required.
2. Identify Impacted Borrowers
* Map export-oriented portfolios and flag sectors/borrowers showing shipment delays, order cancellations, or extended receivables.
* Create an internal tagging mechanism for accounts availing relief.
3. Set Up Application & Verification Workflow
* Roll out a standard relief-request form.
* Train relationship teams to verify evidence of trade disruption and apply eligibility criteria consistently.
4. Implement Moratorium & Working Capital Adjustments
* Automate moratorium/deferment for eligible instalments falling between 1 Sep–31 Dec 2025.
* Update drawing power calculations and temporarily modify margin requirements where justified.
5. Update Export Credit Tenor Handling
* Reconfigure systems to allow up to 450-day repayment periods for eligible pre- and post-shipment credit.
* Align timelines with FEMA regulations for export proceeds realisation.
6. Provisioning & Reporting
* Apply required standard provisions (e.g., 5% or as specified in the final Directions).
* Ensure asset classification remains compliant with the Directions’ non-downgrade provisions.
7. Customer Communication
* Issue updated sanction letters / addenda for revised repayment schedules.
* Proactively notify eligible customers of the relief window to avoid missed opportunities.
8. Monitor & Exit
* Track accounts under relief with heightened monitoring.
* Prepare a January 2026 step-up or normalisation plan to avoid repayment cliffs.
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