RBI FEMA 2026 Export & Import Regulations: New Rules for Indian Exporters and Importers
Reviewed by CA Manoj Kumar
Indian businesses involved in exporting goods, providing services to overseas customers, importing goods or services, or carrying out merchanting trade transactions need to closely monitor their foreign exchange compliance.
The Reserve Bank of India (RBI) has introduced the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 under FEMA. These regulations replace the earlier Foreign Exchange Management (Export of Goods & Services) Regulations, 2015.
The new regulations were notified through Notification No. FEMA 23(R)/2026-RB dated January 13, 2026 and come into force from October 1, 2026.
A significant amendment was subsequently notified on September 22, 2026. Among other changes, the amendment reduced the normal export realisation period from 15 months to 9 months. For exports invoiced or settled in Indian Rupees, the applicable period has been reduced from 18 months to 12 months.
For exporters and importers, these changes make it more important to track invoices, shipping bills, foreign inward remittances, import payments and outstanding entries in EDPMS and IDPMS.
This article explains the important FEMA 2026 export and import rules in simple language, with practical examples and compliance situations.
Table of Contents
What Are the FEMA Export and Import Regulations 2026?
The Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 provide the RBI framework for handling foreign exchange transactions connected with exports and imports.
The regulations cover areas such as:
- Declaration of exports
- Export of goods and services
- Receipt of export proceeds
- Import payments
- Advance payments
- Reduction or non-realisation of export value
- Set-off of export receivables against import payables
- Third-party payments
- Merchanting trade transactions
- EDPMS and IDPMS reporting and closure
- Foreign exchange reporting
- Handling of outstanding export and import transactions
In simple terms, the regulations are designed to ensure that foreign trade transactions are properly declared, payments are received or made within the applicable period, and outstanding transactions are properly monitored and closed.
Who Needs to Follow These Regulations?
The regulations can be relevant to businesses and persons involved in international trade, including:
- Indian exporters of goods
- Indian exporters of services
- Software and technology exporters
- IT and IT-enabled service companies
- Manufacturing exporters
- Importers of goods
- Importers of services
- Merchanting traders
- Businesses receiving advance export payments
- Businesses making advance import payments
- Businesses receiving or making permitted third-party foreign payments
- Businesses with outstanding EDPMS or IDPMS entries
The exact compliance requirement depends on the nature of the transaction, the contract, the payment structure and the applicable FEMA/RBI framework.
When Do the New FEMA Regulations Apply?
The 2026 regulations come into force from:
October 1, 2026
The regulations supersede the earlier FEMA export regulations, subject to the provisions relating to transactions and matters already dealt with under the earlier framework.
The September 22, 2026 amendment is particularly important because it changes the export realisation timelines applicable under the new regulations.
Major Changes and Important Rules at a Glance
| Area |
Important Rule |
| Effective date |
October 1, 2026 |
| Export realisation – normal cases |
Generally within 9 months |
| Export settled/invoiced in INR |
Generally within 12 months |
| Service export declaration |
EDF generally within 30 days from the end of the month in which the invoice is raised |
| Small export/import transactions |
Transactions up to ₹10 lakh receive simplified declaration/closure treatment in specified situations |
| Export value reduction |
AD may permit reduction subject to the prescribed conditions |
| Set-off |
Export receivables may be set off against eligible import payables subject to conditions |
| Third-party payments |
May be permitted by the Authorised Dealer after satisfying itself about the genuineness of the transaction |
| Merchanting trade |
Generally, the period between outward and inward remittance should not exceed 6 months |
| EDPMS/IDPMS |
Outstanding export/import entries need to be monitored and appropriately closed or updated |
Export Declaration Form (EDF) Rules
One of the important parts of the regulations is the declaration of exports.
Export of Goods
An exporter of goods is required to furnish an Export Declaration Form (EDF) specifying the amount representing the full export value.
For goods exported through an Electronic Data Interchange (EDI) port, the EDF is deemed to be submitted as part of the shipping bill.
This means that businesses should ensure that the information declared in their export documentation is accurate and consistent with the underlying transaction.
Export of Services
Service exporters have a separate reporting mechanism.
Generally, an exporter of services must submit an EDF specifying the full export value within 30 days from the end of the month in which the invoice for the services was raised.
A service exporter who has exported services to one or more recipients during a month may submit a single EDF covering those exports, subject to the applicable requirements.
For service exports other than software, an EDF may also be submitted on or before the date of receipt of payment.
An Authorised Dealer may extend the time for submission where the exporter requests an extension and provides reasonable grounds for the delay.
How Service Exporters Need to Report Exports
The new framework is especially relevant to businesses such as:
- IT companies
- Software development companies
- Digital service providers
- Consulting firms
- Engineering service providers
- Marketing and advertising agencies
- Business process outsourcing companies
- Professional service businesses serving overseas clients
For example, suppose an Indian technology company raises invoices to three overseas customers during October 2026.
The company should maintain proper records and follow the applicable EDF reporting process for its service exports.
The business should also reconcile its invoices with the foreign currency receipts and bank records.
New Export Realisation Period: 9 Months
This is one of the most important changes for exporters.
Under the amended 2026 regulations, the amount representing the full export value, or the permitted reduced export value, generally needs to be realised and repatriated within 9 months.
For goods, the period is generally calculated from the date of shipment.
For services, it is generally calculated from the date of invoice.
For goods exported to a warehouse outside India, the period is generally calculated from the date of sale of the goods from the warehouse.
Project exports follow the payment terms of the underlying contract.
The Authorised Dealer may allow an extension where the exporter requests it and provides reasons that satisfy the Authorised Dealer.
Special 12-Month Rule for Exports Invoiced or Settled in INR
The regulations provide a longer period where export transactions are invoiced or settled in Indian Rupees.
In such cases, the period for realisation and repatriation of the full export value is generally 12 months.
This is important for businesses using permitted international trade arrangements involving INR.
Businesses should verify that their particular transaction qualifies under the applicable RBI framework rather than assuming that every transaction involving INR automatically receives the 12-month period.
Reduction or Non-Realisation of Export Value
Sometimes an exporter may not receive the entire amount originally invoiced.
For example:
- The overseas customer disputes part of the invoice.
- Goods are damaged or rejected.
- A commercial discount is agreed after shipment.
- There is a contractual adjustment.
- Part of the receivable becomes unrecoverable.
Under the regulations, an Authorised Dealer may permit reduction in export realisation where the exporter provides reasons and the Authorised Dealer is satisfied with those reasons.
For export value up to ₹10 lakh per shipping bill or invoice, the regulations provide a simplified mechanism where the reduction, including non-realisation of the full export value, may be permitted based on a declaration from the exporter.
Businesses should maintain supporting documents for material reductions and non-realisation cases.
Set-Off of Export Receivables Against Import Payables
International businesses may sometimes have both export receivables and import payables involving the same overseas counterparty or related overseas group entities.
The regulations allow an Authorised Dealer to permit set-off of eligible export receivables against import payables, subject to the prescribed conditions and applicable time period.
For example, an Indian company exports machinery worth USD 100,000 to an overseas group company and separately imports equipment worth USD 40,000 from an eligible overseas group entity.
An eligible set-off arrangement may be considered through the Authorised Dealer, subject to the applicable FEMA requirements.
The business should not make a unilateral accounting adjustment without coordinating with its Authorised Dealer and ensuring that the relevant EDPMS/IDPMS entries are appropriately handled.
Third-Party Receipts and Payments
International transactions do not always involve payment directly between the exporter and the buyer or between the importer and the supplier.
The regulations permit an Authorised Dealer to allow third-party receipts and payments where it is satisfied about the bonafides of the transaction.
This does not mean that third-party payments are automatically permitted in every transaction.
The exporter or importer should maintain documentation explaining:
- Why a third party is making or receiving the payment
- The relationship between the parties
- The contractual arrangement
- The commercial reason for the payment structure
- Supporting invoices and transaction documents
Rules for Import Payments
Importers also have responsibilities under the new framework.
An Authorised Dealer is required to monitor IDPMS entries and follow up with importers for making payment within the period specified in the underlying contract.
Where an importer needs additional time, the Authorised Dealer may allow an extension if the importer provides reasons and the Authorised Dealer is satisfied with those reasons.
Therefore, importers should not simply leave unpaid import transactions outstanding without communicating with their Authorised Dealer.
Advance Payments for Exports and Imports
Advance Receipt for Exports
Where an exporter receives advance payment for an export transaction, the advance amount and subsequent export proceeds should generally be routed through the same Authorised Dealer.
The exporter may use another Authorised Dealer if the change is properly intimated to both Authorised Dealers.
Advance Payment for Imports
Similarly, where an importer makes an advance payment for imports, the advance payment and subsequent payments should generally be routed through the same Authorised Dealer.
An importer may use another Authorised Dealer after properly informing both banks about the change.
The Authorised Dealer may require additional safeguards for significant advance payments, including consideration of a standby Letter of Credit or guarantee depending on the circumstances and thresholds determined by the bank.
Advance Payment for Gold and Silver Imports
A specific restriction applies to gold and silver imports.
Except where otherwise permitted under the applicable law, rules, regulations or directions, an Authorised Dealer cannot permit advance remittance for the import of gold or silver.
Businesses dealing in precious metal imports should therefore review the payment structure carefully before making any advance remittance.
What Happens When an Import Does Not Materialise?
Sometimes an importer pays an overseas supplier in advance, but the goods are not subsequently imported.
Under the regulations, if the import does not take place within the contract period or permitted extended period, the importer should repatriate the advance payment, where applicable.
If the advance is not repatriated within the applicable period, additional conditions may apply to future advance import payments.
For example, future advance payments may require an unconditional and irrevocable standby Letter of Credit or an appropriate guarantee, depending on the circumstances specified in the regulations.
Therefore, importers should actively monitor all advance import transactions rather than treating the payment as completed once the money has been sent.
What Happens When Export Proceeds Remain Unrealised?
Exporters should take particular care when export proceeds remain unpaid for a long period.
Where export proceeds remain unrealised for more than one year beyond the due date of realisation or the extended period permitted by the Authorised Dealer, the exporter may be required to undertake further exports only against:
- Full advance payment; or
- An irrevocable Letter of Credit.
This can significantly affect the working capital and commercial flexibility of an exporter.
Therefore, exporters should identify old outstanding export receivables well before they reach this stage.
Merchanting Trade Transaction (MTT)
Merchanting trade involves a transaction where goods are purchased from one overseas party and sold to another overseas party without the goods necessarily entering India.
The 2026 regulations contain specific requirements for merchanting trade transactions.
Key MTT requirements
- The period between outward remittance and inward remittance, or vice versa, should generally not exceed 6 months.
- Outward remittance should generally be made to the overseas seller.
- Inward remittance should generally be received from the overseas buyer.
- Relevant documents should be provided to the Authorised Dealer to establish the genuineness of the transaction.
- The Authorised Dealer monitors both legs of the transaction.
An extension may be permitted by the Authorised Dealer where the customer provides reasons and the bank is satisfied with those reasons.
EDPMS and IDPMS Compliance
EDPMS stands for Export Data Processing and Monitoring System.
IDPMS stands for Import Data Processing and Monitoring System.
These systems are important for tracking outstanding export and import transactions.
For exporters
The Authorised Dealer monitors export transactions and marks off the relevant EDPMS entry after ensuring that the export value has been realised.
For importers
The Authorised Dealer marks off the IDPMS entry after ensuring that payment for the import has been made.
This means a business should not only focus on its accounting records. It should also periodically reconcile its foreign trade transactions with its bank records and outstanding EDPMS/IDPMS entries.
Reporting Requirements
The regulations require Authorised Dealers to maintain and update reporting systems for export, import and merchanting trade transactions.
For specified transactions, the Authorised Dealer is required to enter relevant information into EDPMS or IDPMS within the prescribed time.
The regulations also require reporting of foreign trade transactions through the applicable RBI reporting mechanism, including the Foreign Exchange Transaction Electronic Reporting System (FETERS), as applicable under the prevailing RBI instructions.
For businesses, this reinforces the importance of keeping accurate documentation and responding promptly to bank queries.
New Expectations from Authorised Dealers
The regulations also introduce detailed requirements for Authorised Dealers, including banks handling foreign exchange transactions.
Authorised Dealers are required to maintain a separate and comprehensive internal policy and Standard Operating Procedure (SOP) covering export, import and merchanting trade transactions.
The SOP should cover matters such as:
- Documents required
- Processing timelines
- Applicable charges
- Extensions of time
- Under-realisation and non-realisation
- Advance receipts and payments
- Internal approval levels
- Factoring transactions
- Customer grievance escalation
- Appeal mechanisms
The regulations also require Authorised Dealers to disclose the policy and main features of the SOP on their websites.
Importantly, charges for handling transactions and related processes are required to be reasonable and proportionate to the services provided. The regulations also state that an Authorised Dealer should not levy charges or penalties on its constituent for a regulatory delay or violation by the constituent.
Practical Examples
Example 1: Export of Goods
An Indian manufacturer exports machinery to a customer in Germany on October 10, 2026.
The exporter should track the shipment date, export declaration, invoice, payment due date and receipt of export proceeds.
Under the general rule, the export value should be realised and repatriated within the applicable 9-month period, unless an applicable extension or other provision applies.
Example 2: Export of IT Services
An Indian software company raises invoices to overseas customers during November 2026.
The company should maintain the invoices and export records and comply with the applicable EDF reporting requirement. For service exports, the general rule requires the EDF within 30 days from the end of the month in which the invoice was raised, subject to the specific provisions of the regulations.
Example 3: Delayed Export Payment
An Indian exporter expects payment from a foreign customer within six months, but the customer delays payment because of a contractual dispute.
The exporter should not simply wait without action. It should discuss the situation with its Authorised Dealer and provide relevant documents and reasons for the delay.
Where appropriate, the Authorised Dealer may permit an extension.
Example 4: Export Value Reduced
An Indian company exports products worth ₹8 lakh. Due to damage during transit, the overseas buyer pays only ₹7 lakh.
The exporter should document the reason for the reduced realisation and follow the applicable process with the Authorised Dealer.
Because the export value is within the ₹10 lakh threshold specified in the regulations, the simplified declaration mechanism for reduction/non-realisation may be relevant, subject to the applicable conditions.
Example 5: Import Advance Not Materialised
An Indian importer makes an advance payment to a foreign supplier, but the supplier subsequently cancels the order and does not ship the goods.
The importer should arrange for repatriation of the advance and properly address the corresponding IDPMS entry with the Authorised Dealer.
Practical Case Studies
Case Study 1: MSME Exporter With Long Customer Credit Period
Situation: An Indian MSME normally gives overseas customers 12-month payment terms.
Issue: The business may now face a mismatch between its commercial credit terms and the general FEMA export realisation period of 9 months.
What should the business do?
- Review all overseas customer contracts.
- Identify customers with payment terms longer than the applicable FEMA timeline.
- Discuss suitable arrangements with the Authorised Dealer.
- Monitor receivables before the regulatory due date approaches.
- Maintain documentation for any requested extension.
Lesson: Export contracts should be reviewed not only from a commercial perspective but also from a foreign exchange compliance perspective.
Case Study 2: Indian IT Company With Multiple Overseas Clients
Situation: An Indian IT company provides software services to customers in the US, UK and Singapore. It raises multiple invoices every month.
Risk: Because there are many invoices and customers, individual export declarations and receipts may become difficult to reconcile.
Better approach:
- Maintain a customer-wise export invoice register.
- Track invoice dates.
- Track EDF reporting.
- Match foreign inward remittances with invoices.
- Review outstanding EDPMS entries regularly.
Lesson: A monthly foreign exchange reconciliation process can help prevent old outstanding entries.
Case Study 3: Importer With Outstanding Advance Payment
Situation: An Indian trading company makes an advance payment to an overseas supplier. The supplier fails to deliver.
Risk: The importer may continue focusing on the commercial dispute while the corresponding foreign exchange transaction remains unresolved.
Better approach: The importer should communicate with the Authorised Dealer, document the commercial dispute, pursue recovery/repatriation of the advance and ensure that the IDPMS position is appropriately addressed.
Lesson: Commercial disputes involving overseas suppliers can also create FEMA compliance consequences.
Case Study 4: Merchanting Trader
Situation: An Indian merchanting trader purchases goods from a supplier in China and sells them to a buyer in the UAE without importing the goods into India.
Compliance focus:
- Track the outward payment to the overseas seller.
- Track the inward receipt from the overseas buyer.
- Ensure the transaction is completed within the applicable six-month period.
- Maintain contracts, invoices and shipping documents.
- Ensure the relevant EDPMS/IDPMS entries are properly updated or closed.
Lesson: Merchanting trade requires monitoring of both sides of the transaction rather than only one payment.
FEMA 2026 Export-Import Compliance Checklist
Businesses involved in international trade should consider maintaining the following checklist:
| Compliance Area |
What to Check |
| Export invoice |
Invoice details, customer, currency, value and payment terms |
| Export declaration |
EDF submitted through the applicable mechanism |
| Export realisation |
Track the applicable 9-month/12-month timeline and contractual requirements |
| Foreign inward remittance |
Match bank receipts with export invoices |
| EDPMS |
Review outstanding entries and ensure eligible entries are closed/updated |
| Import payments |
Track contractual payment deadlines |
| Advance import |
Track delivery, refund/repatriation and IDPMS closure |
| Third-party payment |
Maintain commercial justification and supporting documents |
| Set-off |
Obtain Authorised Dealer guidance before adjusting receivables/payables |
| Merchanting trade |
Track both outward and inward legs within the prescribed period |
| Old receivables |
Identify export proceeds approaching or exceeding applicable timelines |
Common Mistakes Businesses Should Avoid
1. Treating the bank statement as the only compliance record
Receiving money in the bank does not mean every related foreign exchange compliance entry has automatically been closed. Businesses should reconcile their records with the applicable EDPMS/IDPMS position.
2. Ignoring old export receivables
Businesses should not wait until an export receivable becomes significantly overdue before discussing it with their Authorised Dealer.
3. Using third-party payments without documentation
A third-party payment arrangement should have a clear commercial explanation and supporting documents.
4. Making advance import payments without monitoring delivery
Advance payments should be tracked until the import is completed and the relevant foreign exchange reporting position is appropriately resolved.
5. Assuming all delayed payments are automatically acceptable
A commercial payment delay and a FEMA compliance extension are not necessarily the same thing. The exporter or importer should follow the applicable process with the Authorised Dealer.
6. Ignoring merchanting trade timelines
MTT businesses should monitor both the purchase/payment side and sale/receipt side of the transaction.
Government Resources and Official Notification
Businesses should always verify FEMA compliance requirements against the latest official RBI notification, amendments and applicable directions.
Official RBI Notification
Notification No. FEMA 23(R)/2026-RB dated January 13, 2026
Title: Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026
Effective date: October 1, 2026
Issued by: Reserve Bank of India, Foreign Exchange Department
Latest Amendment
Notification No. FEMA 23(R)/(1)/2026-RB dated September 22, 2026
The amendment was published in the Official Gazette of India on September 24, 2026.
Among other changes, this amendment substituted the earlier export realisation periods of 15 months and 18 months with 9 months and 12 months, respectively, as applicable under the regulations.
Download the RBI Notification PDF
For readers who want to review the complete notification, including the Export Declaration Form (EDF), reporting provisions and detailed regulations, IndiaBizExperts can provide the official notification PDF for reference.
Download RBI FEMA 23(R)/2026 Export & Import Regulations 2026 – PDF
Official Government Resources
- Reserve Bank of India (RBI): Visit the RBI website and refer to its FEMA notifications and foreign exchange regulatory resources.
- RBI Foreign Exchange Department: The Foreign Exchange Department issues notifications, directions and regulatory updates relating to FEMA.
- e-Gazette of India: The official Gazette platform can be used to verify notifications published in the Gazette of India.
Important: The PDF provided on this page should be kept unchanged and should correspond to the official RBI/Government notification. Readers should rely on the latest official notification and subsequent amendments for the current legal position.
Frequently Asked Questions
1. When do the FEMA Export and Import Regulations 2026 come into force?
The regulations come into force from October 1, 2026.
2. What is the new export realisation period under FEMA 2026?
The general period for realisation and repatriation of export proceeds is 9 months, subject to the specific provisions and exceptions under the regulations.
3. Is there a different timeline for exports invoiced or settled in INR?
Yes. Where the export is invoiced or settled in Indian Rupees, the regulations provide a 12-month period for realisation and repatriation, subject to the applicable conditions.
4. What happened to the earlier 15-month export realisation period?
The September 22, 2026 amendment substituted the earlier 15-month period with 9 months.
5. What is EDF?
EDF means Export Declaration Form. It is used for declaring export transactions in accordance with the applicable FEMA requirements.
6. Is EDF required for service exports?
Yes. The regulations prescribe an EDF reporting requirement for service exports, with specific timelines and provisions for monthly consolidated reporting in applicable cases.
7. What is the EDF timeline for service exports?
Generally, the exporter of services must submit the EDF within 30 days from the end of the month in which the invoice was raised, subject to the specific provisions of the regulations.
8. Can an Authorised Dealer extend the export realisation period?
Yes. An Authorised Dealer may allow an extension where the exporter requests it and provides reasons that satisfy the Authorised Dealer.
9. Can export value be reduced if the exporter receives less than the invoice amount?
Yes, an Authorised Dealer may permit reduction in export realisation where the applicable conditions are satisfied. A simplified declaration mechanism is also provided for export values up to ₹10 lakh per shipping bill or invoice in specified cases.
10. What is EDPMS?
EDPMS means Export Data Processing and Monitoring System. It is used for monitoring export transactions and their realisation/closure.
11. What is IDPMS?
IDPMS means Import Data Processing and Monitoring System. It is used for monitoring import transactions and related payments.
12. Can export receivables be set off against import payables?
Yes, an Authorised Dealer may allow eligible set-off arrangements subject to the conditions and applicable time limits prescribed under the regulations.
13. Are third-party foreign payments allowed?
They may be permitted by the Authorised Dealer where the bank is satisfied about the genuineness of the transaction and the applicable requirements are met.
14. What is the time limit for merchanting trade transactions?
The period between outward remittance and inward remittance, or vice versa, should generally not exceed six months, subject to the applicable provisions and permitted extension.
15. Can the merchanting trade period be extended?
An Authorised Dealer may allow an extension where the customer provides reasons and the Authorised Dealer is satisfied with those reasons.
16. Can an importer make advance payment to a foreign supplier?
Advance import payments may be permitted subject to the applicable FEMA requirements and the Authorised Dealer's satisfaction regarding the genuineness of the transaction.
17. What happens if an advance-paid import does not take place?
The importer is generally required to repatriate the advance payment if the import does not materialise within the contract or permitted extended period, subject to the applicable provisions.
18. Can advance remittance be made for importing gold or silver?
Generally, no advance remittance is permitted for import of gold or silver by an Authorised Dealer, except where otherwise permitted under the applicable legal framework.
19. What happens if export proceeds remain unrealised for a long period?
If export proceeds remain unrealised beyond one year from the due date or permitted extended period, the exporter may become subject to restrictions requiring future exports against full advance payment or an irrevocable Letter of Credit.
20. Do these regulations affect small exporters and importers?
Yes. The regulations apply based on the nature of the foreign exchange transaction. They also provide certain simplified mechanisms for transactions up to ₹10 lakh in specified situations.
21. Does receiving the export payment automatically close the EDPMS entry?
The Authorised Dealer is responsible for marking off the relevant entry after satisfying itself regarding the realisation and applicable documentation. Businesses should reconcile their outstanding entries with their bank.
22. What should an exporter do if a foreign customer delays payment?
The exporter should review the reason for the delay, maintain supporting documents and approach its Authorised Dealer for appropriate guidance or extension where required.
23. Are these rules applicable to software exporters?
Yes. The regulations specifically recognise software within the broader definition of services for these purposes.
24. What should businesses do before October 1, 2026?
Businesses involved in exports, imports or merchanting trade should review outstanding transactions, payment terms, export receivables, import advances, EDPMS/IDPMS entries and internal documentation before the new framework becomes applicable.
25. Should businesses take professional advice for FEMA export-import compliance?
Businesses with complex export/import structures, delayed payments, third-party payments, set-offs, merchanting trade, large advance payments or long-outstanding EDPMS/IDPMS entries should consider obtaining advice from an appropriately qualified professional and coordinating with their Authorised Dealer.
Conclusion
The FEMA Export and Import Regulations, 2026 create an updated framework for managing India's export and import foreign exchange transactions.
For exporters, one of the most important changes is the reduction of the general export realisation period to 9 months. For exports invoiced or settled in Indian Rupees, the applicable period is generally 12 months.
At the same time, businesses need to pay attention to EDF reporting, export realisation, EDPMS closure, import payments, advance payments, third-party transactions, set-offs and merchanting trade requirements.
The practical lesson is simple: do not wait until a foreign exchange transaction becomes overdue or an EDPMS/IDPMS entry becomes a problem.
Businesses involved in international trade should maintain a regular reconciliation system covering invoices, contracts, bank receipts/payments and outstanding RBI reporting entries.
If your business has outstanding export proceeds, delayed import payments, merchanting trade transactions, third-party payments or other FEMA-related issues, the appropriate compliance position should be reviewed based on the facts of the transaction and the applicable RBI framework.
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Important Disclaimer
This article is intended for general educational and informational purposes only. It is based on the FEMA Export and Import Regulations, 2026 and the amendment information referenced in this article.
Foreign exchange regulations, RBI directions, Master Directions and related requirements may be amended from time to time. The application of FEMA provisions can also depend on the facts, transaction structure, contracts and banking arrangements involved.
This article should not be treated as legal, financial, tax or professional advice. Businesses should verify the latest RBI requirements and, where appropriate, consult an Authorised Dealer and an appropriately qualified professional before taking action.