RBI enhances the cap for advance remittances in certain cases
In cases where the importer (other than a Public Sector Company or a Department/Undertaking of the Government of India/State Government) is unable to obtain bank guarantee from overseas suppliers and the AD Category – I bank is satisfied about the track record and bonafides of the importer, the requirement of the bank guarantee / standby letter of credit may not be insisted upon for advance remittance up to USD 1,000,000 or its equivalent. AD Category – I banks may frame their own internal guidelines to deal with such cases as per a suitable policy framed by the bank's Board of Directors. Now this cap is enhanced to USD 5,000,000 subject to the conditions prescribed therein.
A. P. (DIR Series) CIRCULAR NO. 9/RBI., Dated: August 21, 2008