What changed
Previously, ECB proceeds could be parked in term deposits for a maximum of 12 months cumulatively. Now, as a one-time relaxation, unutilised proceeds drawn down on or before March 1, 2020, can be parked for an extended period until March 1, 2022.
What it means for you
This gives ECB borrowers more flexibility to manage idle funds during the pandemic without breaching the earlier 12-month limit. Banks must update their internal systems and advise clients to ensure compliance with the revised parking timeline.
What you must do
- Update internal ECB monitoring systems to reflect the extended parking deadline of March 1, 2022.
- Notify all ECB borrower clients about the one-time relaxation and its eligibility conditions.
- Verify that the unutilised proceeds were drawn down on or before March 1, 2020, before allowing extended parking.
- Ensure all other ECB policy provisions remain unchanged and are communicated to customers.
Who it affects
AD Category-I banks, ECB borrowers with unutilised proceeds drawn down on or before March 1, 2020
What is the maximum period for parking ECB proceeds under this relaxation?
Unutilised ECB proceeds drawn down on or before March 1, 2020, can be parked in term deposits until March 1, 2022, as a one-time measure.
Does this relaxation apply to all ECB proceeds?
No, it applies only to unutilised proceeds drawn down on or before March 1, 2020. Other ECB policy provisions remain unchanged.