RBI and FEMA

What is the RBI exporter caution list and does it still apply?

Author:: Editorial team, serviceexportguide.com
Verified by:: Editorial team
Published: 28 October 2026
Last modified: 30 October 2026
Reading time: 7 min read

Short answer

The exporters' caution list named exporters who could export only against advance payment or an irrevocable letter of credit.³ From 1 October 2026, regulation 13 of the 2026 export regulations replaces new listings.¹ Proceeds unrealised a year past the due date limit further exports to full advance or a letter of credit.¹ Existing listings continue until removal.¹²

Applies to	Governed by	Deadline	Penalty	Last verified
Exporters with proceeds unrealised more than one year after the due or extended date	FEMA (Export and Import of Goods and Services) Regulations, 2026, regulation 13¹	One year after the due date, which is nine months from the invoice date for services¹	Further exports only against full advance or an irrevocable letter of credit¹	28 October 2026
Exporters in the caution list as on 30 September 2026	Proviso to regulation 13, added on 22 September 2026¹²	Until removed from the list¹²	Governed by the existing RBI order¹²	28 October 2026

For years, Indian exporters with long-unpaid bills risked being placed on the Reserve Bank of India (RBI) "exporters' caution list". The 2026 export rules, in force from 1 October 2026, changed how that works.¹ This guide explains the old list, the new rule in regulation 13, and what a freelancer or agency should do about it.

What is the RBI exporter caution list?

The RBI exporters' caution list was a list of exporters who could export only on secure payment terms. Under paragraph C.28 of the Master Direction on Export of Goods and Services, a bank could handle a caution-listed exporter's export documents only if the exporter produced evidence of advance payment or an irrevocable letter of credit covering the full value of the proposed exports.³

Guarantees: banks needed RBI approval to issue guarantees for caution-listed exporters.³
Legal basis: regulation 16 of the 2015 Regulations let the RBI direct, by general or special order, that a class of exporters must meet conditions such as an irrevocable letter of credit before exporting, after giving the exporter a reasonable opportunity to make a representation.⁴
Replacement: from 1 October 2026, regulation 13 of the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 (the 2026 Regulations) applies a direct rule.¹

The old list depended on an RBI order; the new rule applies by its own terms.¹⁴

Who does the exporter caution list or regulation 13 apply to?

Regulation 13 applies to any exporter whose proceeds stay unrealised for more than one year after the due or extended date, and the caution list still applies to exporters listed on 30 September 2026.¹²

Entity type	Applicable?	Why	Best for
Service exporter with an unpaid invoice more than one year past its due date	Yes, regulation 13	Further exports only against full advance or an irrevocable letter of credit¹	Freelancers and agencies with old unpaid invoices
Exporter whose bank granted an extension	Not while the extension runs	The one year runs from the extended date¹	Exporters with genuine payment delays
Exporter caution-listed as on 30 September 2026	Yes, existing order	The proviso keeps the order in force until removal¹²	Exporters listed under the old system
Exporter with all invoices realised on time	No	Regulation 13 is triggered only by unrealised proceeds¹	Most freelancers and agencies

Check your bank's records if you are unsure which row fits.

How do you stay clear of regulation 13?

You stay clear of regulation 13 by realising each invoice by its due date, or by getting an extension or reduction from your bank before one year passes after the due date.¹

Due dates: track every export invoice against its nine-month due date.¹
Extension: ask for an extension under regulation 5 before the due date if payment is delayed for a genuine reason.¹
Reduction: ask for a reduction under regulation 6 when a client will pay less or nothing; under ₹10 lakh, your declaration is enough.¹
Outstanding entries: check your outstanding entries with your bank regularly. See check EDPMS outstanding.

Your bank's internal policy under regulation 19 must cover extensions and adjustments for under, over and non-realisation, and be published on its website.¹

Which deadlines apply under regulation 13?

The deadline under regulation 13 is one year after the due date of realisation, which for a service invoice is nine months from the invoice date.¹

Invoice type	Due date	Regulation 13 trigger	Best for
Service invoice in foreign currency	Nine months from the invoice date¹	One year after the due date, about 21 months after invoicing if nothing is done¹	Most service exporters
Export invoiced or settled in Indian rupees	Twelve months from the invoice date¹²	One year after that later due date¹²	Exporters invoicing in rupees
Invoice with a bank extension	The extended date allowed by the bank¹	One year after the extended date¹	Exporters with documented delays

The one year runs from the extended date if your bank has granted an extension.¹

What happens if regulation 13 applies to you?

If regulation 13 applies, the exporter "shall undertake further exports only against receipt of full advance or an irrevocable Letter of Credit", so every new client must pay upfront.¹

Unpaid and unregularised: for example, a motion designer has a 2026 invoice to a defunct Berlin studio that was never paid or regularised. More than a year after the due date, she can take new projects only on full advance.¹
Extension in place: for example, an IT services company with a large unpaid invoice from a US client in litigation gets an extension from its bank. Regulation 13 does not bite while the extension runs.¹

The regulation does not say how long the restriction lasts after old dues are cleared; its wording ties it to proceeds that "remain unrealised".¹ Ask your bank how it records the restriction and when it is lifted.

Which RBI rule governs the exporter caution list and regulation 13?

Regulation 13 of the 2026 Regulations sets the current rule, and its proviso, added on 22 September 2026, keeps old caution listings in force.¹²

Rule	Clause	Date	Plain meaning	Best for
FEMA (Export and Import of Goods and Services) Regulations, 2026	Regulation 13	In force 1 October 2026¹	Unrealised for more than one year after the due date means full advance or irrevocable letter of credit	Every exporter from 1 October 2026
FEMA 23(R)/(1)/2026-RB	Paragraph 3, proviso to regulation 13	22 September 2026²	Exporters listed on 30 September 2026 stay under their orders until removed	Exporters listed before October 2026
2026 Regulations	Regulation 20	In force 1 October 2026¹	Banks handle transactions from before 1 October 2026 that needed RBI approval	Exporters seeking removal from the list
FEM (Export of Goods & Services) Regulations, 2015	Regulation 16	Amended up to 5 June 2026⁴	The old power to caution-list by order	Reading old caution-list orders
Master Direction on Export of Goods and Services	Paragraphs C.17, C.22, C.28 and footnote 40	Updated as on 17 July 2026, superseded from 1 October 2026³	How listing worked and which facilities a listed exporter lost	Understanding a past listing
A.P. (DIR Series) Circular No. 20	Paragraph 4 and Annex	16 January 2026⁵	Supersedes the Master Direction and the 2016 and 2020 circulars on caution listing in EDPMS from 1 October 2026	Checking which old circulars still apply

How did an exporter get caution-listed before 2026?

An exporter got caution-listed automatically in EDPMS before 9 October 2020, and by the RBI on the bank's recommendation from then until 30 September 2026.³

Period	How listing worked	Best for
Before 9 October 2020	Automatic in the Export Data Processing and Monitoring System (EDPMS) if a shipping bill stayed open for more than two years without an extension; automatic removal once realised or extended; earlier listing on the bank's recommendation	Exporters reviewing listings made before October 2020
9 October 2020 to 30 September 2026	By the RBI on the bank's recommendation, based on the exporter's track record and reports of investigative agencies, for example adverse notice of the Enforcement Directorate, CBI or DRI, being untraceable, or not making sincere efforts to realise proceeds	Exporters reviewing listings made from October 2020

The table summarises paragraph C.28 and footnote 40 of the Master Direction.³

What if you were caution-listed before 1 October 2026?

An exporter caution-listed before 1 October 2026 stays listed until removed, under the proviso to regulation 13: exporters in the caution list as on 30 September 2026, under orders issued by the RBI under regulation 16 of the 2015 Regulations, continue to be governed by that order until they are removed from the list.¹²

Removal procedure: the 2026 Regulations do not set out a removal procedure.¹
Old route: under the old Master Direction, the bank made recommendations to the RBI Regional Office for de-caution-listing.³
Bank handling: regulation 20 says banks now handle transactions from before 1 October 2026 that needed RBI approval.¹

Ask your bank how it will process a request for removal, and clear or regularise the old outstanding bills first.

What are the common mistakes with the exporter caution list and regulation 13?

The common mistakes are waiting for a listing decision that no longer happens, and letting the one-year clock run without asking for an extension or reduction.¹

Waiting for notice: regulation 13 applies by its own terms; it does not depend on an RBI order or a bank recommendation.¹
Late extension requests: waiting until after the due date to raise a regulation 5 extension with the bank, in place of asking before it.¹
Ignoring write-offs: leaving an invoice a client will never pay open, when a regulation 6 reduction is available on declaration under ₹10 lakh.¹
Assuming old listings lapsed: listings in force on 30 September 2026 continue until removal.¹²

For a past caution listing or a contravention, see also FEMA compounding for exporters, and take advice from a chartered accountant.

How did we verify this?

We checked this page against the sources below on 30 October 2026. Read our methodology or report an error.

Frequently asked questions

Does the RBI still caution-list exporters after 1 October 2026?+

The 2026 Regulations contain no provision for new caution listing by the RBI. Regulation 13 instead restricts further exports to full advance or an irrevocable letter of credit once proceeds are unrealised for more than a year after the due date or the extended date allowed by the bank.¹

I was caution-listed before October 2026. Am I still on the list?+

An exporter caution-listed before October 2026 stays on the list until removed. The proviso to regulation 13, added on 22 September 2026, keeps exporters in the caution list as on 30 September 2026 governed by those RBI orders until they are removed from the list.¹²

How do I avoid the regulation 13 restriction?+

To avoid the regulation 13 restriction, realise the export proceeds, or get an extension under regulation 5 or a reduction under regulation 6 from your bank before one year passes after the due date.¹ Asking early, while the reason for delay is documented, gives the bank time to decide.

Is the RBI exporters' caution list published?+

The RBI rules reviewed for this guide, the 2026 Regulations, the 2015 Regulations and the Master Direction, do not describe a public caution list.¹³⁴ Ask your bank whether you are listed, and how it records any regulation 13 restriction on your account.

Does regulation 13 apply to rupee-invoiced exports?+

Regulation 13 applies to rupee-invoiced exports too. For an export invoiced or settled in Indian rupees, the due date is twelve months from the invoice date, and the one-year period in regulation 13 runs from that later due date.¹² Track rupee invoices on their own schedule.

What facilities did a caution-listed exporter lose?+

Under the old Master Direction, a caution-listed exporter lost access to some bank-level facilities, such as reductions in invoice value under paragraph C.17 and remittance of export claims under paragraph C.22. Banks also needed RBI approval to issue guarantees for such exporters.³

This page is general information for Indian service exporters, not tax or legal advice. Rules change and outcomes depend on your facts, so confirm with a chartered accountant before acting.

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