RBI expands scope of SNRR account to popularise rupee in cross-border transactions

The RBI on November 22 expanded the scope of Special Non-Resident Rupee Accounts by permitting non-residents to open such accounts for rupee denominated overseas borrowings, trade credit and trade invoicing for popularising cross-border transactions in the domestic currency. Any person resident outside India, having a business interest in India, can open a non-interest bearing Special Non-Resident Rupee Account (SNRR account) with a bank for bona fide transactions in rupees.

In a circular, the RBI said it has been decided to expand the scope of SNRR Account by permitting persons resident outside India to open such accounts for external commercial borrowings (ECBs), trade credits, and trade invoicing in Indian rupee.

Further, restriction on the tenure of SNRR account, which is currently seven years, has also been removed.

The Reserve Bank of India (RBI) said it has been taking steps for "popularising the cross-border transactions in Indian rupee".

Meanwhile, the RBI has also modified norms regarding re-export of unsold rough diamonds from special notified zone of Customs without export declaration form (EDF) formality

"For the lot/ lots cleared at the center/s...Bill of Entry shall be filed by the buyer," the circular said.

Banks may permit such import payments after being satisfied with the bona-fides of the transaction, it added.