What changed
RBI reviewed the all-in-cost ceiling for trade credits for imports and decided to keep it unchanged. The ceiling specified in the earlier circular (A.P. DIR Series Circular No. 28 dated September 11, 2012) remains applicable. No other aspects of the trade credit policy were modified.
What it means for you
Banks and importers can continue using the same cost ceiling for trade credits without any adjustment. This provides stability for pricing and planning of import financing. Lenders should ensure compliance with the existing ceiling and not assume any relaxation.
What you must do
- Continue applying the all-in-cost ceiling as per A.P. DIR Series Circular No. 28 dated September 11, 2012 for all trade credits for imports.
- Inform your customers and constituents that the ceiling remains unchanged until further review.
- Monitor any future RBI circulars for potential revisions to the ceiling.
Who it affects
All Category-I Authorised Dealer Banks, Importers using trade credits for imports into India, Branches handling trade finance operations
What is the all-in-cost ceiling for trade credits for imports?
The circular does not specify the exact rate; it only states that the ceiling from the September 11, 2012 circular continues to apply. Banks should refer to that earlier circular for the specific ceiling.
Does this circular change any other trade credit rules?
No. All other aspects of the trade credit policy remain unchanged as per the circular.
When will the ceiling be reviewed again?
The circular does not provide a date for the next review. It says the ceiling will apply 'until further review'.