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TRADE FINANCE |
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Export |
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Q. What is Importer
Exporter Code (IEC) and where can this be obtained?
A. CImporter Exporter Code (IEC) is required for carrying out import or
export activity. The units located in the EPZ or the EOUs can obtain the same
from the Development Commissioners concerned. In respect of units operating in
the Domestic Tariff Area, IEC can be obtained from the office of the Director
General of Foreign Trade. This form can be downloaded from the DGFT website or
from this site under the Heading Exim Policy and Procedures. |
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Q. What is DTA?
A. Domestic Tariff Area. The Units
operating under certain specific schemes such as EPZ/SEZ/EOU are expected to
carryout their activities within customs bonded area. The area which is not
coming under the jurisdiction of custom bonded are called Domestic Tariff Area. |
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Q. What is EEFC account?
A. Exporters of goods / services and other recipients of inward
remittances in convertible foreign currency can open EEFC account to keep their
foreign exchange earnings in the account. |
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Q. What are the limits
prescribed by Reserve Bank to keep the amount received by way of inward foreign
remittances in EEFC accounts?
A. 100% EOU or a Unit in EPZ / STP / EHTP can keep upto 70% of their
foreign exchange earnings in their account and use it for authorised, bonafide
purposes and any other person resident in India can keep upto 50% of the foreign
exchange earnings in this account. |
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RUPEE EXPORT CREDIT
(PRE-SHIPMENT AND POST-SHIPMENT)
SBBJ understands and values your Pre shipment and post shipment
commitments. We offer both Pre shipment and Post shipment credit in rupee
denominated terms to exporters having firm export orders or confirmed letters of
credit.
Avail Rupee export credit at most competitive rates at 67 branches.
Book forward contracts in respect of future export credit drawals. |
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Pre-Shipment Export Credit
We offer Pre-shipment Credit (Packing Credit) to the exporters, for financing
purchase, processing, manufacturing or packing of goods prior to shipment.
You can avail any loan or advance from us on the basis of:
(a) Letter of Credit opened in your favor or in favor of some other person, by
an overseas buyer;
(b) a confirmed and irrevocable order for the export of goods from India;
(c) any other evidence of an order or export from India having been placed on
the exporter or some other person, unless lodgement of export order or Letter of
Credit with the bank has been waived.
Packing Credit is granted for a period depending upon the circumstances of the
individual case, such as the time required for procuring, manufacturing or
processing (where necessary) and shipping the relative goods. Packing credit is
released in one lump sum or in stages, as per the requirement for executing the
orders/LC.
The pre-shipment / packing credit granted has to be liquidated out of the
proceeds of the bill dawn for the exported commodities, once the bill is
purchased/discounted etc., thereby converting pre-shipment credit into
post-shipment credit. |
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Post-Shipment Export Credit
We extend Post-shipment Credit that is any loan / advance granted or any other
credit provided by us for purposes such as export of goods from India.
It runs from the date of extending credit, after shipment of goods to the date
of realization of export proceeds and includes any loan / advance granted on the
security of any duty drawback allowed by the Govt. from time to time.
Post-shipment credit has to be liquidated by the proceeds of export bills
received from abroad in respect of goods exported.
The exporter has the following options at post-shipment stage:
i. To get export bills purchased /discounted / negotiated;
ii. To get advances against bills for collection;
iii. To receive advances against duty drawback receivable from Govt.
The exporter has the option to avail of pre-shipment and post-shipment credit
either in rupee or in foreign currency. However, if the pre-shipment credit has
been availed in foreign currency, the post-shipment credit has necessarily to be
under EBR Scheme since foreign currency pre-shipment credit has to be liquidated
in foreign currency. The details of pre-shipment and post-shipment credit in
foreign currency are mentioned below. |
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PRE-SHIPMENT CREDIT IN FOREIGN
CURRENCY (PCFC)
Our Pre-shipment Credit in Foreign Currency (PCFC) is just what you need, when
you are looking for funds in foreign currency. Avail it to meet your
manufacturing, processing and packing fund requirements at international
interest rates. You can also cover the cost of both domestic as well as imported
inputs. Our PCFC gives you choice of four different currencies in which to
operate the scheme - the US Dollar, Pound Sterling, Euro and the Japanese Yen.
We have… branches across the country handling the PCFC facility for your
convenience. The list of A & B category designated branches, with
addresses/phone and fax nos. etc. are given above.
Our International Banking Department, at Kolkatta, is the nodal centre for
raising and deploying offshore and onshore funds for lending under PCFC. |
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Operating PCFC
PCFC is to be repaid only with the proceeds of the export bill tendered, under
the export bill-rediscounting scheme.
In case of cancellation of export order, the PCFC line may be closed by selling
equivalent amount of foreign exchange at TT selling rate prevalent on the date
of liquidation. |
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Q. How do the schemes operate?
A. PCFC & EBR schemes go hand in hand. The operation of these schemes is
in three stages, viz.
(i) Disbursement of PCFC
(ii) Disbursement of EBR and simultaneous repayment of PCFC and
(iii) Repayment of EBR.
When the exporter has sufficient drawing power available within his overall
limit to accommodate the proposed PCFC advance, PCFC is made available to him
either in foreign currency for payment of his import bills or in Indian rupees
for purchase of domestic raw material by converting the foreign currency of PCFC
at T.T. Buying rate.
PCFC is operated like cash credit account with balances in foreign currency. The
liability of the exporter to the Bank on account of PCFC is in foreign currency.
The rupee equivalent will be shown in the account only at notional rates which
really doesn't concern the exporter.Interest on PCFC will be arrived in foreign
currency and the rupee equivalent thereof will be recovered at quarterly
intervals from the exporter's CC or Current account. |
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Q. Is there any withholding tax on SBBJ PCFC?
A. No withholding tax is payable on the PCFC, if the interest on the
foreign currency line is to be remitted to SBI foreign offices. |
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Q. Can PCFC drawals be booked on a forward basis?
A. Yes, forward contracts can be booked in respect of future PCFC drawals. |
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Q. What about cross currency
drawals?
A. At SBBJ, PCFC drawals in cross currencies are allowed, subject to the
exporter bearing the risk in currency fluctuations. However, cross currency
drawals are restricted to the US Dollar. For instance, for an export order in a
non-designated currency like the Swiss Franc, PCFC will be given only in USD.
However, for orders in Pound Sterling, Euro and the Japanese Yen, pre-shipment
credit may be availed in the respective currencies or USD. Multiple currency
drawals against the same order are not permitted, for the sake of operational
convenience. |
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Q. What are the special advantages in availing
PCFC & EBR from us? |
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A. |
- Network of designated branches to handle the
schemes
- No minimum amount is prescribed for drawals
under PCFC and EBR schemes
- No withholding tax need be paid by the
exporters, as the lines of credit for funding PCFC and EBR are drawn by SBI
from its own foreign offices.
- Competitive rates of interest for customers
with good credit rating and high value business.
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Q. Is there any
withholding tax on SBBJ's EBR facility?
A. No withholding tax is payable on the PCFC, if the interest on the
foreign currency line is remitted to SBI foreign offices. Since the bank
dispenses lines of credit only from its foreign offices, exporters need not pay
withholding tax. |
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Q. What are the provisions
governing exports from India?
A. Export trade is regulated by the Directorate General of Foreign Trade
(DGFT) and its regional offices, functioning under the Ministry of Commerce and
Industries, Department of Commerce, Government of India. Policies and procedures
required to be followed for exports from India are announced by the DGFT.
Branches should conduct export transactions in conformity with the Export-Import
Policy in vogue and the Rules framed by the Government of India). Further, RBI
has made the Foreign Exchange Management (Export of Goods and Services)
Regulations, 2000 relating to export of goods and services from India. These
Regulations have been notified vide Notification No. FEMA 23/2000-RB, dated 3rd
May, 2000, as amended from time to time. |
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Q. What are forms on which
exports are required to be declared?
A. GR, PP and SOFTEX forms are forms on which exports are required to be
declared. GR forms are required to be completed in duplicate for export
otherwise than by Post including export of software in physical form i.e.
magnetic tapes/discs and paper media. PP forms are required to be completed in
duplicate for export by Post. SOFTEX forms are required to be completed in
triplicate for declaration of export of software otherwise than in physical
form, i.e. magnetic tapes/discs, and paper media. |
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Q. What is form SDF?
A. On account of introduction of Electronic Data Interchange (EDI) System
at certain Customs offices where shipping bills are processed electronically,
the existing declaration in GR form is replaced by a declaration in form SDF
(Statutory Declaration Form). The SDF form should be submitted in duplicate (to
be annexed to the relative shipping bill) to the concerned Commissioner of
Customs. After verifying and authenticating the declaration in form SDF, the
Commissioner of Customs will hand over to the exporter, one copy of the shipping
bill marked ‘Exchange Control Copy’ in which form SDF has been appended for
being submitted to the authorised dealer within 21 days from the date of export.
The authorised dealer should accept the Exchange Control (EC) copy of the
shipping bill and form SDF appended thereto, submitted by the exporter for
collection/negotiation of shipping documents. The manner of disposal of EC copy
of shipping Bill (and form SDF appended thereto) is same as that for GR forms. |
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Q. How should the GR/PP/SOFTEX
form should be disposed?
A. (i) Copies of export declaration forms should be disposed of as under :
(a) GR forms should be completed by the exporter in duplicate and both the
copies submitted to the Customs at the port of shipment along with the shipping
bill. Customs will give their running serial number on both the copies after
admitting the corresponding shipping bill. The Customs serial number will have
ten numerals denoting the code number of the port of shipment, the calendar year
and a six digit running serial number. Customs will certify the value declared
by the exporter on both the copies of the GR form at the space earmarked and
will also record the assessed value. They will then return the duplicate copy of
the form to the exporter and retain the original for transmission to Reserve
Bank. Exporters should submit the duplicate copy of the GR form again to Customs
along with the cargo to be shipped. After examination of the goods and
certifying the quantity passed for shipment on the duplicate copy, Customs will
return it to the exporter for submission to the authorised dealer for
negotiation or collection of export bills.
(b) Within twenty-one days from the date of export, exporter should lodge the
duplicate copy together with relative shipping documents and an extra copy of
the invoice with the authorised dealer named in the GR form. After the documents
have been negotiated/sent for collection, the authorised dealer should report
the transaction to Reserve Bank in statement ENC under cover of appropriate
R-Supplementary Return. However, the duplicate copy of the form together with a
copy of invoice etc. will henceforth be retained by the branch and may not be
submitted to Reserve Bank.
(c) Where a part of export proceeds are credited to EEFC account, the export
declaration (duplicate) form may be certified as under :
"Proceeds amounting to....... representing......% of the export realisation
credited to EEFC account maintained by the exporter with......"
(ii) The manner of disposal of PP forms is same as that for GR forms.
Postal authorities will allow export of goods by post only if the original copy
of the form has been countersigned by an authorised dealer. Therefore, PP forms
should be first presented by the exporter to an authorised dealer for
countersignature. Authorised dealer will countersign the forms in accordance
with directions of RBI and return the original copy to the exporter, who should
submit the form to the post office with the parcel. The duplicate copy of the PP
form will be retained by the branch to whom the exporter should submit relevant
documents together with an extra copy of invoice for negotiation/collection,
within the prescribed period of twenty-one days.
(iii) The exporter should submit declaration in Form SOFTEX in triplicate
in respect of export of computer software and audio / video / television
software to the concerned designated official of Government of India at STPI /
EPZ /FTZ /SEZ for valuation / certification not later than 30 days from the date
of invoice / the date of last invoice raised in a month, as indicated above. The
designated officials may also certify the SOFTEX Forms in respect of EOUs which
are registered with them. As for disposal of SOFTEX forms the procedure
indicated in Regulation 6 of Export Regulations is to be observed. However, the
duplicate copy of the form together with a copy of invoice etc. will henceforth
be retained by the branch and may not be submitted to Reserve Bank. |
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Q. Are there
any exemptions permitted by RBI from declarations?
A. (i) The requirement of declaration of export of goods and
software in the prescribed form will not apply to the cases
indicated in Regulation No. 4 of FEMA Notification 23/RB-2000
dated May 3, 2000 as amended from time to time. The requirement
of declaration also shall not apply to goods sent for testing
abroad, subject to re-import. Exporters have been exempted from
submission of declaration in prescribed format for exports of
value not exceeding US $ 25,000 or its equivalent. The exporters
shall however, be liable to realize and repatriate export
proceeds as per FEMA regulations.
(ii) Branches may consider requests for grant of GR
waiver from exporters for export of goods free of cost, for
export promotion upto 2 percent of average annual exports of the
applicant during the preceding three years subject to a ceiling
of Rs.5 lakhs. |
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Q. What is the
manner in which payment for goods exported can be received from
abroad?
A. (i) The amount representing the full export value of the
goods exported shall be received through an authorized dealer in
the manner specified in the Foreign Exchange Management (Manner
of Receipt & Payment) Regulations, 2000 notified vide
Notification No. FEMA 14/2000-RB, dated 3rd May, 2000.
(ii) Payment for export may also be received by the
exporter in the following manner : |
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In the form
of bank draft, pay order, banker’s or personal cheques.
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Foreign
currency notes/foreign currency travellers’ cheques from the
buyer during his visit to India.
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Payment out
of funds held in the FCNR/NRE account maintained by the
Buyer.
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Through
International Credit Cards. When payment, in respect of
goods sold to overseas buyers during their visits is
received in this manner the GR/SDF (duplicate) should be
released by the authorised dealers only on receipt of funds
in their Nostro account or on production of a certificate by
the exporter from the Credit Card servicing bank in India to
the effect that it has received the equivalent amount in
foreign exchange, if the authorised dealer concerned is not
the Credit Card servicing bank. Branches may also receive
payment for exports made out of India by debit to the credit
card of an importer where the reimbursement from the card
issuing bank/organisation will be received in foreign
exchange.
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All
transactions between a person resident in India and a person
resident in Nepal may be settled in Rupees. However, in case
of export of goods to Nepal, where an importer resident in
Nepal has been permitted by the Nepal Rashtra Bank to make
payment in free foreign exchange, such payments shall be
routed through the ACU mechanism.
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Payment of
export may also be received by the Gem & Jewellery units in
SEZs and EOUs in the form of precious metals i.e. Gold /
Silver / Platinum equivalent to value of jewellery exported
on the condition that the sale contract provides for the
same and the approximate value of the precious metals is
indicated in the relevant GR / SDF / PP Forms.
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Q. What
happens in case of short shipment/shut-out shipment?
A. (i) When part of a shipment covered by a GR form already
filed with Customs is short-shipped, exporter must give notice
of short-shipment to Customs in form and manner prescribed. In
case of delay in obtaining certified short-shipment notice from
Customs, exporter should give an undertaking to the branch to
the effect that he has filed the short-shipment notice with the
Customs and that he will furnish it as soon as it is obtained.
(ii) Where a shipment has been entirely shut out and
there is delay in making arrangements to re-ship, exporter will
give notice in duplicate to Customs in the manner and in form
prescribed for the purpose, attaching thereto the unused
duplicate copy of GR form and the shipping bill. Customs will
verify that the shipment was actually shut out, certify copy of
the notice as correct and forward it to Reserve Bank together
with unused duplicate copy of the GR form. In this case, the
original GR form received earlier from Customs will be
cancelled. If the shipment is made subsequently, a fresh set of
GR form should be completed. |
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