RBI CAUTIONS BANKS ON EXPORT FINANCE

The Reserve Bank of India (RBI) has advised banks to be cautious while extending guarantees against export advances, so as to ensure that no violation of Foreign Exchange Management Act 1999 ( FEMA ) regulations takes place and banks are not exposed to various risks. Banks should also ensure that the export advances received by the exporters are in compliance with the regulation / directions issued under the FEMA 1999.