What is the Gold Card Scheme for exporters?

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 the Gold Card Scheme for Exporters shall be strictly implemented by the banks and the branch level functionaries suitably sensitised in this regard.

The Gold Card Scheme envisages certain additional benefits to the exporters based on their record of performance. The Card holder exporters, depending on their track record and credit worthiness, will be granted better terms of credit with faster delivery of credit facility.

The salient features of the Scheme are:

1. Banks may issue Gold Card to all eligible exporters including those in the small and medium sectors who satisfy the laid down conditions of the bank. Banks would clearly specify the benefits they would be offering to Gold Card holders.
2. The charges schedule and fee-structure in respect of services provided by banks to exporters under the Scheme will be relatively lower than those provided to other exporters. The applicable rate of interest to be charged under the scheme will not be more than the general rate for export credit in the respective bank. However, the best rate would be offered on the basis of rating and past performance of the exporter.
3. Foreign currency credit cards may be issued to Gold Card holders, on the basis of their track record of timely realization of export bills for meeting urgent payment obligations, etc.
4. While granting packing credit in foreign currency, the Gold Card holders would be given preference compared to others.
5. A Bank may consider waiver of collaterals and exemption from ECGC guarantee schemes on the basis of card holder’s creditworthiness and track record.
6. The Gold card holder will be provided with value addition to their cards through supplementary services like ATM, Internet banking, International debit / credit cards may be decided by the issuing banks.
7. Applications for credit facility will be processed at norms simpler and under a process faster than for other exporters. Requests from card holders would be processed by the banks within 25 days / 15 days and 7 days for fresh applications / renewal of limits and ad hoc limits, respectively.
8. The sanction and renewal of the limits under the Scheme will be based on a simplified procedure as per the discretion of the bank concerned. The need based limits are decided by the bank on the basis of the anticipated export turnover and track record of the exporter with a liberal approach.
9. Bank may additionally made available a stand-by limit of not less than 20 per cent of the assessed limit to facilitate urgent credit needs for executing sudden orders. In the case of exporters of seasonal commodities, the peak and off-peak levels may be appropriately specified.
10. In case of unanticipated export orders, norms for inventory may be relaxed, taking into account the size and nature of the export order.
11. The ‘In-principle’ limits will be normally sanctioned for a period of 3 years with a provision for automatic renewal subject to fulfillment of the terms and conditions of sanction.
12. The exporters blacklisted by ECGC or having overdue bills in excess of 10% of the previous year’s turnover is not eligible under the scheme.