Forex & International Banking

Foreign exchange, trade finance, export/import, and NRI banking.

Forex Trade Finance Export Import NRI Banking FEMA

Articles

Export Exporting from India: IEC, Shipping Bills, and Export Incentives Explained

Every exporter needs an Importer-Exporter Code and a shipping bill before goods leave India, and can typically claim incentive schemes on top. Here is the basic flow.

11 Sep 2026 · 2 min read NRI Banking NRE vs NRO Accounts: Which One Does an NRI Actually Need?

Non-resident Indians often need both an NRE and an NRO account for different purposes. Here is how repatriability, taxation, and funding sources differ between the two.

10 Sep 2026 · 2 min read Trade Finance MT 767 Explained: Guarantee Amendment

How changes to an already-issued bank guarantee or standby LC — a new amount, extended validity — are communicated.

10 Sep 2026 · 2 min read Trade Finance MT 760 Explained: Guarantee / Standby Letter of Credit

How a bank issues an independent guarantee or standby LC — a promise to pay only if the applicant fails to perform.

09 Sep 2026 · 2 min read Trade Finance MT 752 Explained: Authorization to Pay, Accept or Negotiate

The issuing bank's green light to honour documents that were flagged as discrepant, after the applicant waives them.

08 Sep 2026 · 2 min read Trade Finance MT 750 Explained: Advice of Discrepancy

How a bank flags discrepant documents and asks the issuing bank for permission to honour them anyway.

07 Sep 2026 · 2 min read Trade Finance Letter of Credit Basics: How an LC Protects Both Sides of a Trade

A Letter of Credit shifts payment risk from the buyer to a bank. Here is how the LC lifecycle works, who the parties are, and why documents matter more than the goods themselves.

06 Sep 2026 · 2 min read Trade Finance MT 742 Explained: Reimbursement Claim

How the bank that paid under a Letter of Credit actually gets its money back from the reimbursing bank.

06 Sep 2026 · 2 min read Trade Finance MT 740 Explained: Authorization to Reimburse

How an issuing bank instructs a reimbursing bank to honour claims from the bank that pays under a Letter of Credit.

05 Sep 2026 · 2 min read

Frequently Asked Questions

Yes. The LRS ceiling is an annual limit tied to the financial year (April–March) and resets at the start of each new financial year.

A mismatch is called a "discrepancy." The issuing bank can refuse payment until the discrepancy is corrected or the buyer waives it, so exporters should check documents carefully before presentation.

No. NRE accounts are meant for foreign income only. Income earned in India, such as rent or salary, should go into an NRO account.

Yes, IEC registration itself does not expire, though DGFT has introduced a requirement to periodically confirm/update IEC details online to keep it active.

A business generally needs a valid IEC to import commercially. Beyond that, some goods are freely importable while others need a specific licence or are subject to restrictions under the current Foreign Trade Policy.

Yes — FEMA governs all cross-border foreign exchange transactions by residents and non-residents in India, though many routine transactions are freely permitted within prescribed limits and reporting requirements.

Each resident individual, including minors (through a guardian), has their own separate LRS limit, so family members can each remit up to their individual ceiling.

No. An LC is a primary payment mechanism used to settle a trade, while a Bank Guarantee is a secondary commitment that is only invoked if the applicant fails to perform an obligation.

Not completely — NRIs can repatriate funds from an NRO account up to a specified limit per financial year, subject to applicable tax compliance and RBI/FEMA conditions.

Both refund embedded costs on exports, but they cover different components — drawback traditionally refunds customs duties on inputs, while RoDTEP was introduced to cover a broader range of previously non-refunded taxes and levies. Check current DGFT notifications for exact scope and rates.

HSN (Harmonized System of Nomenclature) is the international classification code for goods, and it determines the applicable customs duty rate and any product-specific regulatory requirements — accurate classification is essential to avoid clearance delays or penalties.

FEMA, enacted in 1999, replaced the older Foreign Exchange Regulation Act (FERA). The shift moved India's foreign exchange framework from a criminal-law-oriented, restrictive regime toward a civil, management-oriented approach aligned with economic liberalisation.