Master Circular on ECB and Trade Credits (2013-14)

What changed

This master circular consolidates all prior instructions on External Commercial Borrowings and Trade Credits into a single reference document, superseding individual circulars listed in the appendix. It updates the framework as of June 16, 2014, and will be replaced by a new master circular on July 1, 2014.

What it means for you

Banks and ADs now have a single, authoritative source for ECB and trade credit guidelines, simplifying compliance and reducing the need to track multiple circulars. The circular clarifies automatic and approval routes, including eligible borrowers, lenders, all-in-cost ceilings, and end-use restrictions, which directly impacts how banks process and monitor cross-border borrowing transactions.

What banks were required to do at the time

• Review the consolidated master circular to ensure all ECB and trade credit processing aligns with the updated guidelines.
• Update internal procedures and training materials to reference this master circular as the primary source for ECB and trade credit rules.
• Ensure all reporting requirements (Form ECB, Form TC, etc.) are followed as per the consolidated instructions.

Who it affects

All Authorised Dealer Category-I banks, Authorised banks handling ECB and trade credits, Indian companies accessing external commercial borrowings