Security for External Commercial Borrowings (ECB)
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…
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Export Finance: A Strategic Enabler of International Trade
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.…
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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…
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Regulatory Framework Governing Exporters in India: FEMA and Foreign Trade Policy Guidelines
Exporters in India operate within a regulatory ecosystem shaped primarily by the Foreign Exchange Management Act (FEMA), 1999, and the Foreign Trade Policy (FTP) of the Directorate General of Foreign Trade (DGFT). These regulations govern critical aspects of export operations, including currency invoicing, realization of export proceeds, documentation, licensing, and procedural compliance. Exporters are also…
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Banking Facilities for Exporters and Importers: Financial and Institutional Support Mechanisms
Exporters and importers are extended a wide array of financial and logistical facilities by banks and other supporting institutions. These services are designed to facilitate smooth international trade operations, enhance liquidity, and promote competitiveness in the global market. Key facilities include export and import financing, letters of credit, guarantees, foreign currency accounts, and a variety…
Packing Credit facility in banks explained
Banks extend export credits to their customers in two stages viz. (i) pre-shipment stage and (ii) post-shipment stage. The first stage of the loan is the pre-shipment stage where the loan is released for procuring, Packing processing (where necessary), manufacturing, and finally for packing of goods. The loans and advances so provided by the banks,…
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