What changed
RBI extended the May 13, 2013 circular's consignment import restrictions to all nominated agencies and premier/star trading houses. Now, all gold imports on consignment by banks and agencies are permitted only for exporters of gold jewellery. Additionally, all LCs for gold imports require 100% cash margin, and imports must be on Documents against Payment (DP) basis; Documents against Acceptance (DA) is banned, except for jewellery exporters.
What it means for you
Banks and nominated agencies face stricter liquidity and documentation requirements for gold imports. The 100% cash margin on LCs and DP-only basis increase upfront costs and reduce trade credit flexibility. However, exporters of gold jewellery are exempt, so lenders must carefully verify end-use to avoid compliance breaches.
What you must do
- Update internal gold import policies to require 100% cash margin on all LCs and DP-only terms for non-exporter imports.
- Implement end-use verification checks to ensure consignment imports are only for jewellery exporters.
- Train trade finance staff on the ban on DA basis for gold imports and the exemption for exporters.
- Communicate these changes to all constituents dealing with gold imports immediately.
Who it affects
Scheduled commercial banks acting as Authorised Dealers, Nominated agencies for gold import, Premier/star trading houses importing gold, Exporters of gold jewellery (exempted from restrictions)
Does the 100% cash margin on LCs apply to all gold imports?
Yes, all LCs for gold imports under any category must be on 100% cash margin basis, except imports meant for exporters of gold jewellery.
Can we still import gold on Documents against Acceptance (DA) basis?
No, DA basis is not permitted for any gold imports, except those meant for exporters of gold jewellery. All imports must be on Documents against Payment (DP) basis.
Who is exempt from these restrictions?
Imports of gold to meet the needs of exporters of gold jewellery are exempt from the consignment restriction, 100% cash margin on LCs, and the DP-only requirement.