RBI Report
Reviewing FEMA norms to rationalise framework for foreign loans
This story was originally published at 16:59 IST on 29 May 2025
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--RBI: Preparing revised framework for authorised persons under FEMA
--RBI: Reviewing FEMA norms for rationalisation of ECB framework
--RBI: Reviewing FEMA norms draft regulations to simplify guarantees issued
MUMBAI – The Reserve Bank of India is reviewing certain guidlines of the Foreign Exchange Management (Borrowing and Lending) Regulations, 2018 to rationalise the framework for external commercial borrowings, the central bank said in its annual report Thursday.
"Post in-principle approval of the revised Phase I implementation of software platform for external commercial borrowings and trade credits reporting and approval (SPECTRA) project in June 2024, the necessary final approvals and vendor confirmations for rolling out of the project are underway," the report said.
Further, amid a "significant increase" in authorised persons and emergence of new business models, the central bank is in the process of reviewing authorisation framework under FEMA, the report said. It aims to address potential misuse, plug regulatory gaps, enhance ease-of-doing business and encourage innovation while ensuring safeguards. The central bank is preparing revised framework for authorised persons under FEMA, the report said.
The central bank was also reviewing the FEMA norms draft regulations to simplify the guarantees issued, the report said. The framework relating to mode of payment and reporting of non-debt instruments under FEMA is also being reviewed.
The central bank also said it was in the process of revising the liberalised remittances scheme, along with the amendments to relevant rules of FEMA. End
Reported by Sourabh Kumar
Edited by Akul Nishant Akhoury
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