RBI allows third-party payments for export, import transactions

Easing procedures, the Reserve Bank on Friday allowed third-party payment for export and import transactions.

With a view to further liberalise the procedure relating to payments for exports/imports, banks are allowed payments for export of goods/software to be received from a third-party, the RBI said.

Banks are also permitted to make payments to a third-party for import of goods, it added.

Third-party refers to an entity other than the buyer or the seller.

The RBI said the procedure has been liberalised taking into account evolving international trade practices.

However, banks would have to follow certain conditions.

Third-party transaction should take place through the banking channel and with a Financial Action Task Force (FATF) compliant country.

"Normally payment for exports has to be received from the overseas buyer named in the Export Declaration Form (EDF) by the exporter and the payment shall be received in a currency appropriate to the place of final destination as mentioned in the EDF irrespective of the country of residence of the buyer," it said.

Similarly, the payments for the import should be made to the original overseas seller of the goods, RBI added. 
PTI