Delays by banks in processing export documents and updating EDPMS

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Delays by banks in processing export documents and updating EDPMS

Garima Prakash

@GarimaP

July 28, 2023

Public Policy

489

On July 28, 2023, we wrote to the Foreign Exchange Dealer's Association of India (FEDAI), seeking information on the status of implementation of the advisory by FEDAI to banks regarding expedited reconciliation of export documents. Our earlier represenation to FEDAI and the action taken by them is available here and here.

We have now reached out to FEDAI highlighting that exporters, especially small and medium sized (SME) exporters, continue to face challenges with banks in relation to reconciliation of export documents.

In particular, we highlighted the following challenges:

Processing fees: AD Banks charge a very high fees on each shipping bill. Some banks are charging upwards of Rs. 1400 per shipping bill for closure of entry in the Export Data Processing and Monitoring System (EDPMS). Since the order value for SME exporters is very small, these charges are too heavy for them.
Submission of documents in hard copy: Banks are requesting the submission of several documents in hard copy by the exporter on a monthly basis (such as, invoices, packing slips, SOFTEX, copy of Export Declaration Form etc.). All these documents need to be submitted for every order. Exporters have to prepare sets of documents for each order, take a print out, manually sign all these documents and then submit at branch once a month. Such a practice is too onerous and not practical for the industry, especially for small scale exporters.
Pending entries in EDPMS: The entries in EDPMS are pending to be updated by banks, for the last couple of years. This is pending even after all necessary documents have been submitted by the exporter.
Risk of non-compliance: Exporters continue to receive reminder emails from the bank asking for the document, even after the exporter has already submitted the documents. The reminder e-mails warn that, according to RBI circulars, the exporters would be caution listed if any shipping bill against them remains open for more than two years in EDPMS.
No communication channel: There is no clear communication channel with the bank to address any deficiencies or to put in a request for updating the EDPMS entries. The emails being received from banks are from a ‘no-reply’ address, and therefore can’t reverted on. While the branch office accepts the documents from exporters, the trade finance teams at banks are not contact-able.

We have emphasied that t

his is a serious problem for the industry, especially the SME players. The uncertainty and the risk of non-compliance even after the exporters are fulfilling their duties, it too high. We have sought FEDAI's support in resolving the issue.

If you are an exporter and have been facing issues with respect to delays by banks in reconciliation of inward remittances even after you have submitted all required documents, kindly write to us at garima@nasscom.in and policy@nasscom.in.

inward remittance EDPMS. RBI

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Garima Prakash

Manager, Public Policy and Government Affairs

Reach out to me for all things policy about e-commerce, international trade, export controls, start-ups and fintech

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