Current · Source: Reserve Bank of India · RBI/2012-13/338 · issued 14 Dec 2012 · ~1 min read
Quick answerRBI has extended the existing all-in-cost ceiling for External Commercial Borrowings (ECB) until March 31, 2013. No changes to the ceiling or other ECB rules. Banks must inform customers and ensure compliance with FEMA provisions.
The rule, in the simplest words
RBI (India's central bank) said the cost limit for borrowing money from other countries (ECB) stays the same until March 31, 2013.
No other rules about borrowing from abroad changed—only the date was pushed forward.
Banks must tell their customers about this extension and follow all foreign exchange rules (FEMA).
After March 2013, the cost limit might change, so plan ahead.
How it plays out — a real example
A forex & trade-finance officer in Indore is helping a corporate client arrange a loan from a foreign bank. She checks the RBI circular and confirms the all-in-cost ceiling (the maximum total interest and fees) remains unchanged until March 31, 2013. She informs the client that they can proceed with their borrowing plan under the same cost limits, giving them confidence to finalize the deal.
What changed
The all-in-cost ceiling for ECB, previously set in March 2012, will remain in force until March 31, 2013. No other ECB policy aspects have been altered. The extension is effective immediately and subject to future review.
What it means for you
Banks and borrowers can continue using the same cost limits for ECB without any new restrictions or relaxations. This provides short-term certainty for ongoing and planned ECB transactions. Lenders should note that the ceiling may be revised after March 2013, so forward planning should account for potential changes.
What you must do
Inform all constituents and customers about the continued applicability of the existing all-in-cost ceiling until March 31, 2013.
Ensure all ECB transactions comply with the unchanged policy, including the cost ceiling.
Monitor RBI announcements for any review or revision of the ceiling after March 2013.
Maintain records of ECB approvals and cost calculations as per FEMA guidelines.
Who it affects
All Category-I Authorised Dealer Banks, Borrowers availing External Commercial Borrowings, Corporate treasuries and finance teams managing ECB
❓ Common questions
What is the all-in-cost ceiling for ECB that remains unchanged?
The ceiling specified in A.P. (DIR Series) Circular No. 99 dated March 30, 2012 continues to apply. The circular does not provide the specific rate, but it refers to that earlier circular for details.
When will the current all-in-cost ceiling be reviewed?
The ceiling is extended until March 31, 2013, and will be subject to review after that date. No further details on the review process are given.
Are there any other changes to ECB policy in this circular?
No. All other aspects of ECB policy remain unchanged. Only the all-in-cost ceiling extension is addressed.
📜 Read the original circular — full text as issued by RBI
RBI/2012-13/338
A.P. (DIR Series) Circular No. 60
December 14, 2012
To,
All Category - I Authorised Dealer Banks
Madam / Sir,
External Commercial Borrowings (ECB) Policy – Review of all-in-cost ceiling
Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to A.P. (DIR Series) Circular No. 99 dated March 30, 2012 and A.P. (DIR Series) Circular No. 40 dated October 09, 2012 relating to ECB.
2. It has been decided that the all-in-cost ceiling as specified in A.P. (DIR Series) Circular No. 99 dated March 30, 2012 will continue to be applicable till March 31, 2013 and subject to review thereafter. All other aspects of ECB policy remain unchanged.
3. The amended ECB policy will come into force with immediate effect and is subject to review based on the experience gained in this regard.
4. AD Category-I banks may bring the contents of this circular to the notice of their constituents and customers concerned.
5. The directions contained in this circular have been issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions / approvals, if any, required under any other law.
Yours faithfully,
(Rashmi Fauzdar)
Chief General Manager
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2012-13/338 · issued 14 Dec 2012. The plain-English explanation above is BankPulse’s own independent summary.
Maintain records of ECB approvals and cost calculations as per FEMA guidelines.
📜 Compliance
Inform all constituents and customers about the continued applicability of the existing all-in-cost ceiling until March 31, 2013.
Ensure all ECB transactions comply with the unchanged policy, including the cost ceiling.
Monitor RBI announcements for any review or revision of the ceiling after March 2013.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are a Compliance officer at a bank this circular applies to (All Category-I Authorised Dealer Banks, Borrowers availing External Commercial Borrowings, Corporate treasuries and finance teams managing ECB), your first concrete step on “ECB All-in-Cost Ceiling Extended Till March 2013” is: “Inform all constituents and customers about the continued applicability of the existing all-in-cost ceiling until March 31, 2013.” (RBI issued this 14 Dec 2012).
Circular: RBI/2012-13/338 -- ECB All-in-Cost Ceiling Extended Till March 2013
Issued: 14 Dec 2012
Action required: Inform all constituents and customers about the continued applicability of the existing all-in-cost ceiling until March 31, 2013.
Action required: Ensure all ECB transactions comply with the unchanged policy, including the cost ceiling.
Action required: Monitor RBI announcements for any review or revision of the ceiling after March 2013.
Action required: Maintain records of ECB approvals and cost calculations as per FEMA guidelines.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=7756&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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