Forex & International Banking

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

Forex Trade Finance Export Import NRI Banking FEMA

Articles

Trade Finance MT 400 Explained: Advice of Payment (Collections)

How the collecting bank tells the remitting bank that a documentary or clean collection has been paid.

27 Aug 2026 · 2 min read Forex MT 210 Explained: Notice to Receive

How a bank gives its correspondent advance warning of an incoming credit, to help with liquidity planning.

22 Aug 2026 · 2 min read Forex MT 205 Explained: Financial Institution Transfer Execution

How an intermediary bank in a payment chain instructs the next leg of an interbank transfer it has just received.

21 Aug 2026 · 2 min read Forex MT 202COV Explained: Cover Payment

Why banks use a special version of MT 202 that carries the underlying customer details, for sanctions and AML screening.

20 Aug 2026 · 2 min read Forex MT 202 Explained: General Financial Institution Transfer

The bank-to-bank SWIFT message that settles the interbank leg behind a customer payment or moves funds for another institution.

19 Aug 2026 · 2 min read Forex MT 200 Explained: Financial Institution Transfer for its Own Account

How a bank moves its own money between its accounts at different correspondents — not a customer payment.

18 Aug 2026 · 2 min read Forex MT 190 Explained: Advice of Charges, Interest and Other Adjustments

How a correspondent bank tells an account-holding customer bank about charges or interest applied to their account.

17 Aug 2026 · 2 min read Forex MT 111 Explained: Request for Stop Payment of a Cheque

What goes into a formal SWIFT request to block a specific cheque from being honoured.

16 Aug 2026 · 2 min read FEMA FEMA Basics: Capital Account vs Current Account Transactions

The Foreign Exchange Management Act draws a key distinction between capital and current account transactions, which determines how freely a cross-border transaction is permitted.

15 Aug 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.