The RBI’s revised FEMA framework takes effect October 1, changing export realisation timelines, service-export reporting, import payment procedures and compliance requirements for Indian businesses.
The Reserve Bank of India (RBI) is introducing changes to the foreign exchange rules governing India's export and import transactions from October 1, 2026. The revised framework changes timelines for receiving export proceeds, introduces formal reporting for service exports and provides greater flexibility for import payments.
The changes are expected to affect businesses involved in international trade, particularly exporters and importers that regularly deal with foreign-currency transactions.
One of the most significant changes is the reduction in the standard period for exporters to realise and repatriate export proceeds.
Under the new framework, exporters will generally have nine months, compared with the earlier 15-month period, to receive and bring export earnings back to India.
For goods, the nine-month period will generally be calculated from the date of shipment. For services, the calculation will begin from the date on which the invoice is raised.
For goods sent to an overseas warehouse, the relevant period will be calculated from the date on which the goods are sold from that warehouse.
Exports invoiced or settled in Indian rupees will also have a revised realisation period of 12 months, down from the earlier 18 months.
The revised framework does not completely eliminate flexibility for exporters facing delayed payments.
An exporter can approach its Authorised Dealer (AD) bank for an extension. The bank may permit additional time when the exporter provides reasons that the bank considers satisfactory.
This makes AD banks more important in monitoring outstanding export receivables and handling cases where payments are not received within the prescribed period.
Another major change involves exports of services. The new regulations introduce a formal Export Declaration Form (EDF) requirement for service exporters.
An exporter will generally need to submit the EDF within 30 days from the end of the month in which the relevant invoice is raised.
The framework also allows a single EDF to cover multiple service exports made to different recipients during the same month.
The formal declaration process is expected to provide AD banks with greater visibility into India's service exports.
Although service exporters were already required to comply with FEMA provisions relating to the realisation and repatriation of export proceeds, the new reporting mechanism brings these transactions under a more structured declaration system.
Exporters may therefore need to pay closer attention to documentation, payment timelines and coordination with their banks.
The RBI has also changed the approach to monitoring payments for imports.
Under the revised framework, AD banks will monitor import payments based on the payment period specified in the underlying commercial contract between the Indian importer and overseas supplier.
If additional time is required, the importer can request an extension from the AD bank and provide supporting reasons.
The revised approach gives businesses greater scope to structure international payment schedules according to the commercial terms agreed with overseas suppliers.
Instead of relying solely on a standard regulatory timeline, the payment period can take greater account of the contractual arrangement between the parties.
This could be particularly relevant for businesses with longer procurement, manufacturing or delivery cycles.
The new FEMA framework also introduces simplified procedures for relatively small export transactions.
For exports of goods or services valued at up to ₹10 lakh per shipping bill or invoice, exporters can provide a declaration confirming that payment has been realised.
This declaration can help facilitate closure of the transaction in the Export Data Processing and Monitoring System (EDPMS).
The rules also provide a simplified mechanism for dealing with reductions in export value for eligible transactions within the ₹10 lakh threshold.
This includes situations where the exporter does not receive the entire export value, subject to the conditions prescribed under the regulations.
The measure is intended to reduce procedural complexity for smaller-value international transactions.
The revised rules bring several changes that exporters and importers will need to account for from October 1.
For exporters:
Standard export realisation period reduces to nine months.
Rupee-denominated exports get a 12-month period.
Service exports come under formal EDF reporting.
AD banks gain an important role in extensions and monitoring.
Smaller transactions up to ₹10 lakh receive simplified treatment.
For importers:
Payment monitoring will be linked more closely to contractual payment periods.
Extensions can be considered by AD banks when satisfactory reasons are provided.
Businesses involved in cross-border trade should therefore review their internal compliance systems, payment schedules and documentation before the revised framework takes effect.
Conclusion
The RBI's revised FEMA framework from October 1, 2026 changes how Indian businesses manage export proceeds, service-export reporting and import payments. While exporters face a shorter standard realisation period, importers gain greater flexibility linked to commercial contracts. The simplified ₹10 lakh procedure could also reduce compliance requirements for eligible smaller transactions.