Contents

June 2025 MPC Resolution

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FEDAI NEWSLETTER Working Group on Timings
of Financial Markets
MPC Resolution and Governor’s Statement
Click for Minutes of MPC
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The 55th MPC concluded on June 6, 2025 voted to reduce the policy repo rate by 50 basis points to Amendment in
5.50% with immediate effect; third consecutive reduction after 25 BPS each in last two policies’ FEMA Export Regulations &
announcements. Consequently, the SDF rate under the liquidity adjustment facility shall stand adjusted FEMA (NDI) Rules
to 5.25% and the marginal standing facility rate and the Bank Rate to 5.75%. MPC also decided to reduce ────
the Cash Reserve Ratio of all banks by 100 basis points in four equal tranches of 25 PBS each to 3.0 per Import of Vessel
cent of net demand and time Liabilities. Accordingly, banks will require to maintain the CRR at 3.75 per ────
cent, 3.5 per cent, 3.25 per cent and 3.0 per cent of their NDTL effective from the reporting fortnight DEAF and KYC Update in
beginning September 06, October 04, November 01 and November 29, 2025, respectively Inoperative Accounts/
MPC took note of global uncertainties and in Indian perspectives going forward and opined that Unclaimed Deposits
economic activity continues to maintain the momentum in 2025-26. The sustained rural economic ────
activity bodes well for rural demand, while continued expansion in services sector is expected to support Updates from IFSCA
the revival in urban demand. Investment activity is expected to improve in light of higher capacity ────
utilization, improving balance sheets of financial and non-financial corporates, and government’s
Updates from DGFT
capital expenditure push.
During this month, European Central Bank reduced policy refinancing rate by 25 BPSPA to 2.15%; FED
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Reserve USA and Bank of England and decided to status qua in their policy rates announcements on 18 ICC News
June 2025 & on 19 June 2025, respectively. ────
Recommendations of the Working Group on Comprehensive Review of Trading and FEDAI Workshop
Settlement Timings of Various Markets Regulated by the RBI Click here to see details ────
Group constituted as per the announcement made in ‘Statement on Developmental and Regulatory Market Events
Policies’ dated February 07, 2025, recommended no change in timing of Fx. Market, interest rate ────
derivative & Government Securities Market; however, suggested that the market hours of the call money Market News
market be extended till 7:00 PM while the market hours for market repo and TREP be synchronised
and extended till 4:00 PM. The Group also recommended unifying the TREP trading hours for members ICC - UCPDC 600
settling obligation through Designated Settlement Banks (DSBs) and through the RBI. The Group Commentary on Art. 26 & 27
recommended preponing the timing of pre-announced LAF auction to 9:30 AM – 10:00 AM from 10:00 Continued from Previous month...
AM to 10:30 AM currently. It also suggested, post onshore market hours, transactions in Government Article 26 -
securities with non-residents could be permitted during a time window between 5:00 PM and 11:30 PM. Shipper’s Load and Count / Said by
The Group recommended that such transactions, if permitted, be reported to NDS-OM on T+1 day Shipper to Contain: These clauses are
before onshore market hours and settled on a T+2 basis. acceptable in transport documents. These
Amendment in FEM (Export of Goods & Services) Regulations clauses indicate that the carrier is relying
Export of Tugs or Tug Boats, Dredgers and Vessels used for providing offshore support services, subject on the shipper's declaration for the number
to their re-import into India henceforth may be made without furnishing the export declaration. and/or type of goods, and that carrier is not
Amendment in FEM (Non-debt Instruments) Rules guaranteeing the accuracy of this
An Indian company, engaged in a sector or activity prohibited for foreign direct investment, may information.
henceforth issue bonus shares to its pre-existing shareholders who are persons resident outside India, Charges Additional to Freight: A
subject to certain specified conditions. transport document may reference
Import of Shipping Vessel Click here to see details additional charges beyond the freight cost.
In order for enhancing ease of doing business and keeping in view the sector-specific constraints, RBI This can be done through a stamp or
w.e.f. June 13, 2025 allowed importers to make advance remittance for import of shipping vessel, notation. If a letter of credit indicates that
without bank guarantee, or an unconditional, irrevocable standby Letter of Credit, up to USD 50 million. costs additional to freight are not
Such advances are made subject to similar compliances which are currently applicable when advance is acceptable, a transport document is not to
remitted against import of Aircrafts/ Helicopters and other Aviation related Purchases. indicate that costs additional to the freight
The Depositor Education and Awareness Fund Scheme, 2014 Click here to see details have been or will be incurred.
KYC Update in Inoperative Accounts/ Unclaimed Deposits in Banks Click here to see details
Article 27 – Clean Transport
RBI issued revised guidelines of the scheme facilitating all operations through e-Kuber System.
Document:
Henceforth, the window for transferring unclaimed amounts/deposits to the Fund through e-Kuber
Purpose and Scope: Article 27
shall be kept open only during the last five working days of every month and one consolidated deposit
addresses the “condition” of transport
will be accepted from each bank. Similarly, each bank/ member of scheme may submit a claim from the
documents presented under a
Fund in e-Kuber system during the first 10 working days of every month.
documentary credit. It aims to ensure that
In a related development, in order to reduced numbers of Inoperative Accounts/ Unclaimed Deposits
banks only accept transport documents
in banks, RBI also amended extant instructions and asked banks to make available the facility of
that do not indicate damage or defects in
updation of KYC for activation of inoperative accounts and unclaimed deposits at all branches
the goods or their packaging. This
(including non-home branches). Further, banks are asked to endeavour to provide the facility of
safeguards the buyer's interest.
updation of KYC in such accounts and deposits through Video-Customer Identification Process (V-CIP).
Updates from IFSCA What does “Clean” mean? A “clean”
- Indian resident individuals (RI) are currently permitted to open & operate the Foreign Currency transport document: must not have any
Accounts in IBU under LRS Facility. IFSCA has now suggested change in declaration obtained from clause, remark, or notation that expressly
RI at the time of opening of the account. declares
Updates from DGFT (i) a defective condition of the goods, or
- Name of ‘The Sports Goods Export Promotion Council’ and ‘The Silk & Rayon Textiles Export (ii) a defective condition of the packaging.
Promotion Council’ is changed to Sports Goods & Toys Export Promotion Council and Manmade and This is consistent with international
Technical Textiles Export Promotion Council (MATEXIL), respectively. banking practice, where a clean document
ICC News implies that the carrier or their agent took
- ICC has shared the draft consolidated Opinions 1302 – case TA949rev, TA950 and TA951 for custody of the goods without visible damage
comments from all national committees and groups for its August 2025 ICC BO meeting. or irregularities.
• FEDAI Workshop No Need for the Word “Clean”: The
07th to 11th July 2025: 5-Day Classroom Orientation Workshop (Non - Residential) on "Foreign Trade article explicitly states that the word
and Foreign Exchange Business" at Indian Bank, IMAGE, Chennai "clean" is not required on the document,
23rd July 2025: One Day Online (3 hours) Workshop on “SWIFT - Financial messaging services” even if the credit specifies or requires
30th July 2025: One Day Online (3 hours) Workshop on "Countering Trade based Money Laundering” transport document mentioning “clean on
Upcoming Market Events board”. Thus, banks focus on the substance
RBI MPC Meeting - 05th to 07th August 2025 (i.e., absence of damage notations) rather
ECB Monetary - 23rd to 24th July 2025 than form (specific wording like "clean").
FOMC Meeting - 29th to 30th July 2025 Bank's Examination Responsibility:
Market News Banks don’t inspect the goods, but only
➢ Her excellency the President of India appointed Shri T. Rabi Sankar, Deputy Governor of RBI as a
examine documents. While examining a
part-time Member of the Sixteenth Finance Commission transport document, if there is no negative
➢ The FEDAI Managing Committee approved selection of Shri Vivek Wahi, currently Executive
notation, it is deemed clean. If there is
Director, Central Bank of India, for the position of Chief Executive, FEDAI negative clause, even one line indicating
➢ FSIB recommended name of Shri R Doraiswamy for the position of CEO & MD in LIC
defect, the bank must reject the document
➢ RBI, in collaboration with an OTC Platform launched a five-part documentary series titled ‘RBI
i.e raise it as a discrepancy.
Unlocked: Beyond the Rupee’ which takes the audience through 90-year history of the bank.
To be continued …
➢ RBI relocated its Andhra Pradesh Regional Office to Vijayawada from Hyderabad.