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Rupee Export Credit Interest Rates
Please refer to paragraphs 67 to 69 of the statement on Monetary and Credit Policy for the year 2001-2002 enclosed to the Governor�s letter No. MPD / BC / 206/ 07.01.279 /2000-01 dated April 19, 2001.
2. Accordingly, it has been decided to specify only ceilings on interest rates for rupees export credit which will be linked to Prime Lending Rates (PLRs) of individual banks available to their other domestic borrowers and provide freedom to banks for deciding the actual rates to be charged within the specified ceilings. The revised rates of interest to be effective from May 5, 2001 alongwith the existing rates applicable upto May 4, 2001 have been incorporated in the Annexure to the Directive DBOD. No. BC/ 101/ 13.07.01/ 2001 dated April 19, 2001 enclosed with this circular.
3. It is clarified that while specifying ceiling interest rates for different time buckets under any category of export credit, banks should take into account the Prime Lending Rate relevant for the entire tenor of export credit extended under the category. Further, since these are ceiling rate banks would be free to charge any rate below the ceiling rates.
4. The revision in the interest rates would be applicable not only to fresh advances but also to the existing advances for the remaining period.
5. We shall, therefore, be glad if you will please specify the ceiling interest rates applicable for export credit as indicated above to be made effective from May 5, 2001 and issue necessary guidelines to your branches, Copy of the circular issued to the branches by you may positively be forwarded to us for our information and record.
6. Please acknowledge receipt.
DIRECTIVE DBOD No. BC 101/ 13.07.01/ 2001 dated 19th April 2001
Interest Rates on Advances
In exercise of the powers conferres by sections 21 and 35A of the Banking Regulation Act 1949, the Reserve Bank of India, being satisfied that it is necessary and expedient in the public interest so to do, hereby directs that with effect from May 5, 2001 the interest rates on rupee export credit be changed as indicated in the Annexure enclosed to this Directive.
ANNEXURE: INTEREST RATES ON EXPORT CREDITS OF SCHEDULED COMMERCIAL BANKS
Categories of Export Credit |
Interest Rates (% per annum) |
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Existing upto May 4, 2001 |
Revised @ (with effect from May 5, 2001) |
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1. Pre-Shipment Credit
(a) I) Upto 180 days |
10.0 |
Not exceeding PLR minus 1.5 percentage points |
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II) Beyond 180 days and upto 270 days |
13.0 |
Not exceeding PLR plus 1.5 percentage points |
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(b) Against incentives receivable from Government covered by ECGC guarantee upto 90 days |
10.0 |
Not exceeding PLR minus 1.5 percentage points |
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2. Post- Shipment Credit
(a) On demand bills for transit period (as specified by FEDAI) |
Not exceeding 10.0 |
Not exceeding PLR minus 1.5 percentage points |
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(b) Usance Bills (for total period comprising usance period of export bills, transit period as specified by FEDAI and grace period wherever applicable)
i) Upto 90 days |
Not exceeding 10.0 |
Not exceeding PLR minus 1.5 percentage points |
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ii) Beyond 90 days and upto 6 months from the date of shipment |
12.0 |
Not exceeding PLR plus 1.5 percentage points |
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(c) Against incentives receivable from Government covered by ECGC guarantee upto 90 days |
Not exceeding 10.0 |
Not exceeding PLR minus 1.5 percentage points |
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(d) Against undrawn balances (upto 90 days) |
Not exceeding 10.0 |
Not exceeding PLR minus 1.5 percentage points |
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(e) Against retention money (for supplies portion only) payable within one year from the date of shipment (upto 90 days) |
Not exceeding 10.0 |
Not exceeding PLR minus 1.5 percentage points |
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3. Deferred Credit
Deferred credit for the period beyond 180 days |
Free |
Free |
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4. Export Credit not otherwise specified
a) Pre-shipment Credit |
Free |
Free |
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b) Post-shipment Credit |
Free |
Free |
Note: @ since these are ceiling rates, banks would be free to charge any rate below the ceiling rates.
*Free: The banks are free to decide the rate of interest to be charged, keeping in view the PLR and spread guidelines
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