RBI Extends Repatriation Timeline for Exporters’ FC Accounts

Notification No. FEMA 10(R)(7)/2025-RB, Dated: 06.10.2025

1. Introduction

The Reserve Bank of India (RBI) has introduced an important regulatory update through the Foreign Exchange Management (Foreign Currency Accounts by a Person Resident in India) (Seventh Amendment) Regulations, 2025. This amendment focuses on extending the repatriation timeline for funds held by exporters in foreign currency accounts maintained outside India. The move is part of RBI’s broader strategy to provide greater operational flexibility to Indian exporters.

2. Key Regulatory Change

Under the revised framework, exporters maintaining foreign currency accounts with banks located in International Financial Services Centres (IFSCs) are now allowed to retain export proceeds for up to three months from the date of receipt. This is a significant increase from the earlier repatriation period of one month. However, for exporters holding accounts in other jurisdictions, the existing one-month repatriation timeline remains unchanged.

 3. Rationale Behind the Amendment

The amendment aims to ease liquidity management for exporters and align regulatory timelines with the evolving nature of global trade. By allowing a longer repatriation period for IFSC-based accounts, the RBI is encouraging the use of IFSCs as preferred financial hubs for trade-related transactions. This step is also expected to enhance India’s position as a competitive player in international trade and finance.

4. Benefits for Exporters and Trade Ecosystem

This regulatory relaxation will help exporters better manage their foreign exchange earnings, optimise cash flows, and plan trade settlements more effectively. It may also reduce transaction costs and foreign exchange conversion pressure by allowing exporters to hold foreign currency for a longer period. Additionally, increased activity through IFSCs will contribute to their growth as international financial centres.

 5. Conclusion

The RBI’s decision to extend the repatriation timeline for IFSC-based foreign currency accounts marks a progressive step toward trade facilitation and financial liberalisation. While retaining the 1-month limit for other jurisdictions ensures prudential oversight, the extended timeline for IFSC accounts provides a competitive advantage to exporters. This move is expected to support India’s export growth and further deepen the role of IFSCs in global trade financing.

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