The Reserve Bank of India (RBI) has eased the Merchanting Trade Transaction (MTT) rules by extending the time period for outlay of foreign exchange from four to six months and also simplified the process for timely closure of entries in Export Data Processing and Monitoring System (EDPMS) and Import Data Processing and Monitoring System (IDPMS) for transactions upto Rs 10 lakh per bill.
The move would significantly improve the ease of doing business, especially for small exporters and merchants, according to industry body Engineering Export Promotion Council India (EEPC India).
Pankaj Chadha, Chairman, EEPC India, said, in a statement, “The reforms introduced by the RBI were long-pending demands of EEPC India. We welcome the decision and the circulars issued in this regard. The move is set to reduce compliance burden for MSME exporters and ensure procedural flexibility for traders.”
The RBI circular extending the time period for outlay of foreign exchange to 6 months under the Merchanting Trade Transactions (MTT) framework has come into effect from October 1, 2025. The other circular regarding the closure of entries in EDPMS and IDPMS is also effective immediately.
Under the new rule, entries (including outstanding entries) in EDPMS and IDPMS of a value up to Rs 10 lakh can be reconciled and closed based on a declaration provided by the concerned exporter that the amount has been realised or by the importer that the amount has been paid.
Any reduction in declared value or invoice value of the shipping bills/bills of entry shall also be accepted, based on the declaration by the concerned exporter or importer.
The circular states that Authorised Dealer Category–I banks (AD banks) shall not levy any penal charges for delays in adherence to regulatory guidelines.
RBI has taken several other noteworthy steps recently to boost trade. They include promotion of the Indian Rupee (INR) in the settlement of cross-border trade and setting a reference rate for the rupee against currencies of major trade partners. The RBI has also announced that allow balances in Special Rupee Vostro Account (SRVA) to be invested in corporate bonds and commercial papers.
“All these measures would give a big push to trade and investment besides helping the Indian Rupee go global gradually,” Chadha said.