Quick answerRBI updates ECB return rules, affecting AD Category I banks and borrowers, with changes to late submission fees and return submissions.
What changed
The RBI has updated the rules for External Commercial Borrowing returns, including changes to Form ECB 1 and Revised Form ECB 1 (treated as returns that do not capture flows), late submission fee (LSF) provisions, and return submission procedures. The designated AD Category I bank must submit complete returns to the RBI within seven calendar days. LSF for Form ECB 2 is calculated per return, i.e., each delayed submission of Form ECB 2 under a Loan Registration Number is treated as a separate instance.
What it means for you
These changes aim to improve the efficiency and accuracy of ECB return submissions. Banks and borrowers must adhere to the new rules to avoid late submission fees and ensure compliance with the Foreign Exchange Management Act, 1999. The updates may impact the operational processes of AD Category I banks and their customers.
The rule, in the simplest words
Form ECB 1 and Revised Form ECB 1 are now treated as returns that do not track money flows, so late fees are calculated differently.
Each late submission of Form ECB 2 under a Loan Registration Number (LRN) counts as a separate instance for the fixed part of the late fee.
The designated AD Category I bank must send the complete return to the RBI within 7 calendar days after getting it from the borrower.
Late fees must be paid to the RBI's regional office using NEFT or RTGS only after getting an email from the RBI that says they received the return.
If a return is late, the AD Category I bank must make sure their customer pays the late fee.
How it plays out — a real example
A gold-loan officer in Indore receives a completed Form ECB 2 from a borrower on June 5, 2026. She checks it is fully filled and certified, then submits it to the RBI by June 12, 2026, which is within the 7-calendar-day rule. If the borrower had submitted it late, she would remind them to pay the late fee via NEFT after the RBI sends an acknowledgment email.
What you must do
Review the updated ECB return rules
Ensure timely submission of returns to the RBI
Comply with late submission fee requirements
Update internal processes to reflect the changes
Who it affects
AD Category I banks, Borrowers, Authorized Dealer banks
What are the changes to Form ECB 1 and Revised Form ECB 1?
These forms will be treated as returns that do not capture flows, with late submission fees computed accordingly.
How will late submission fees be computed?
Late submission fees will be computed based on each delayed submission, with each instance treated as a separate case.
What is the deadline for submitting returns to the RBI?
The designated AD Category I bank must submit complete returns to the RBI within seven calendar days from the date of receipt.
📜 Read the original circular — full text as issued by RBI
RBI/2025-26/253
A.P. (DIR Series) Circular No. 25
March 30, 2026
All Authorised Dealer Category I Banks,
Madam / Sir,
Reporting under Foreign Exchange Management Act, 1999 – Returns pertaining to External Commercial Borrowing (ECB)
Attention of Authorised Dealer Category I banks is invited to A.P. (DIR Series) Circular No. 16 dated September 30, 2022 and Part V and XIII of Master Direction – Reporting under Foreign Exchange Management Act, 1999 .
2. On a review, the following changes are being made to the extant directions with reference to the returns pertaining to External Commercial Borrowing (ECB):
(i) Form ECB 1 and Revised Form ECB 1 (known as Form ECB and Revised Form ECB respectively prior to notification of Foreign Exchange Management (Borrowing and Lending) (First Amendment) Regulations, 2026 ) shall be treated as returns which do not capture flows. Late Submission Fee for delayed submission of these forms shall be computed accordingly;
(ii) LSF amount is per return. Therefore, each delayed submission of Form ECB 2 return submitted under a Loan Registration Number (LRN) shall be treated as a separate instance for computation of the fixed component of LSF;
(iii) The designated AD Category I bank shall submit the return (complete in all aspects) received from the eligible borrower, along with due certification, to the Reserve Bank within seven calendar days from the date of its receipt;
(iv) The LSF, wherever applicable, shall be payable at the Regional Office concerned of the Reserve Bank by way of NEFT or RTGS, post receipt of an e-mail from the Reserve Bank acknowledging receipt of the return. Detailed instructions in this regard will be contained in the said acknowledgment e-mail; and
(v) In case of delayed submission of returns, the designated AD Category I bank shall monitor payment of applicable LSF by their customers/ constituents.
3. These directions shall come into effect from April 01, 2026.
4. Authorised Dealer banks may bring the contents of the circular to the notice of their customers/ constituents concerned.
5. The directions contained in this circular have been issued under sections 10(4), 11(1) and 11(2) 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,
(Dr. Aditya Gaiha)
Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2025-26/253 · issued 30 Mar 2026. The plain-English explanation above is BankPulse’s own independent summary.
Test yourself
Quick self-check built only from the facts already on this page — tap a question to reveal the answer.
Q1. In one line, what does this circular do?
RBI updates ECB return rules, affecting AD Category I banks and borrowers, with changes to late submission fees and return submissions.
Q2. Who does this circular apply to?
AD Category I banks, Borrowers, Authorized Dealer banks
Q3. What is the first thing you should do about it?
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 (AD Category I banks, Borrowers, Authorized Dealer banks), your first concrete step on “ECB Return Updates” is: “Review the updated ECB return rules” (RBI issued this 30 Mar 2026).
Circular: RBI/2025-26/253 -- ECB Return Updates
Issued: 30 Mar 2026
Action required: Review the updated ECB return rules
Action required: Ensure timely submission of returns to the RBI
Action required: Comply with late submission fee requirements
Action required: Update internal processes to reflect the changes
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.
AI-drafted · AI fact-check pending · under the editorial review of our expert review panel · decoded & published by BankPulse · 06 Jul 2026, 15:54 IST
Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13345&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert review panel. Independent platform, not affiliated with the Reserve Bank of India; never reproduces RBI text verbatim.
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