What changed
The earlier relaxation that allowed exporters 12 months to realise and repatriate export proceeds (valid until March 31, 2013) has been rolled back. The new deadline is 9 months from the date of export, effective immediately and valid until September 30, 2013. This change was made in consultation with the Government of India.
What it means for you
Banks must now enforce a tighter 9-month timeline for export proceeds realisation, down from the temporary 12-month window. This could increase pressure on exporters to bring back earnings faster, potentially impacting working capital cycles. The relaxation for SEZ units and overseas warehouse exports remains unchanged, so those segments are not affected.
What you must do
- Update internal systems and compliance checklists to reflect the 9-month realisation period for all export transactions.
- Communicate the revised timeline to all exporter customers and advise them to adjust their receivables management.
- Monitor export bills and follow up with customers to ensure proceeds are repatriated within the new 9-month window.
- Ensure that SEZ and overseas warehouse export transactions continue to follow existing realisation period rules.
Who it affects
All Category-I Authorised Dealer banks, Exporters of goods and software (non-SEZ), Banks' trade finance and forex operations teams
Does this circular apply to SEZ units?
No, the provisions for SEZ units and exports to overseas warehouses remain unchanged.
What is the effective date of the new 9-month period?
The circular is effective from May 20, 2013, and the relaxation is valid until September 30, 2013.
What was the previous realisation period before this circular?
The earlier circular (November 20, 2012) had extended the period to 12 months, which expired on March 31, 2013. This circular reduces it to 9 months.