RBI has permits third party payment for import-export transaction to give comfort to rice traders under certain conditions.
In a notification released by RBI,RBI said that in order to promote the import/export of goods/software it allows the payment from third party(other than buyers)“With a view to further liberalising the
procedure relating to payments for exports/imports and taking into account evolving international trade practices.
Also it allows the Banks to make payments to a third-party for import of goods, however, banks would have to follow certain conditions.
The notification added that, “Firm irrevocable order backed by a tripartite agreement should be in place.”
Third party payment either for import or export could be accepted by the bank only if it come from a Financial Action Task Force (FATF) compliant country and through the banking channel.
Normal Import-Export Transaction
Normally payment for exports has to be received from the overseas buyer named in the Export Declaration Form (EDF) by the exporter and the payment shall be received in a currency appropriate to the place of final destination as mentioned in the EDF irrespective of the country of residence of the buyer.
Similarly, payments for the import should be made to the original overseas seller of the goods, the apex bank added.