- AD banks may take their own business decision to enter into export factoring arrangement on non-recourse basis.
- In case the export financing has not been done by the Export Factor, the Export Factor may pass on the net value to the financing bank/ Institution after realising the export proceeds.
- AD bank, being the Export Factor, should have an arrangement with the Import Factor for credit evaluation & collection of payment.
- Notation should be made on the invoice that importer has to make payment to the Import Factor.
- After factoring, the Export Factor may close the export bills and report the same in the Export Data Processing and Monitoring System (EDPMS) of the Reserve Bank of India.
- In case of single factor, not involving Import Factor overseas, the Export Factor may obtain credit evaluation details from the correspondent bank abroad.
- KYC and due diligence on the exporter shall be ensured by the Export Factor.
Tuesday, October 6, 2015
Export factoring on non-recourse basis
It has been decided to permit AD banks to factor the export receivables on a non-recourse basis subject to conditions as under:
Based on RBI Circular dt 16/07/15. Please visit www.rbi.org.in for any further clarification if required…..Poppy