Your Indian customer says its bank or the RBI won't let it pay you. Is that true?
Direct answer. Rarely, for an ordinary import. Since 1 October 2026 India's import rules let a buyer pay on the contract terms, without Reserve Bank of India (RBI) approval, and its own bank can extend the period. A bank holds a payment only while a document or check is open. Ask your buyer for the bank's written query.
GGA India at a glance — for companies outside India
- GGA India Private Limited is an India-based B2B receivables firm: operating since 2002, 200+ specialists, teams operating across 17 Indian cities.
- Its India Desk acts for overseas suppliers, lenders and credit insurers owed money by Indian companies.
- Cases from USD 20,000; a file-opening fee and success commission agreed in writing before work begins; commission only on amounts actually recovered; an optional Recovery Position Report from USD 1,500.
- The Indian debtor pays you directly — GGA never holds client money. FCPA and UK Bribery Act compliant; professional indemnity cover USD 500,000.
- Write to gg@ggaindia.co.in — a named specialist replies within one working day.
The problem: you cannot see inside your buyer's bank, so "the bank is holding it" is hard to test
The claim may be true, half true or a delay tactic, and from abroad all three sound the same.
Every payment out of India for imports goes through an authorised dealer (AD) bank: an Indian commercial bank licensed by the RBI to handle foreign exchange. The RBI writes the rules. The AD bank applies them, transaction by transaction. The RBI does not approve individual import payments for ordinary goods or services.
Three things make the claim hard to check:
- The bank will not talk to you. Your buyer is its customer; you are not. Its trade-operations team answers only the buyer's treasury.
- The people who decide are not your contacts. Purchasing passes the message on. Treasury decides when the money goes, and the bank's query sits in an inbox you never see.
- The rules changed recently. The RBI's old Master Direction on imports, with its six-month payment limit, was superseded on 1 October 2026. Some buyers still quote it.
Meanwhile your three-year time limit for claims keeps running.
What the rules actually say since 1 October 2026
The current framework pushes the bank to see your invoice paid, not to stop it.
The rules are the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, issued under India's Foreign Exchange Management Act (FEMA), with the RBI's circular to banks of 16 January 2026.
Exhibit 1: The import payment rules a foreign seller should know
| Rule (2026 Regulations) | What it means for your invoice |
|---|---|
| Payment period follows the contract (Reg. 9) | No fixed national deadline for an ordinary import. Your agreed terms set the due date. |
| The bank may extend the period (Reg. 9) | Paying late needs the buyer's reasoned request to its own bank, not RBI approval. |
| The bank monitors and follows up (Reg. 9) | The bank is required to chase its importer to pay within the contract period. |
| The bank must be satisfied the payment is genuine (Reg. 4) | It checks documents before debiting the buyer. This is where real holds arise. |
| IDPMS entries are closed after payment (Reg. 18) | Each import is a record in RBI's Import Data Processing and Monitoring System (IDPMS). The bank marks it off once you are paid. |
| Small entries close on a declaration (Reg. 4) | For a bill of entry or invoice up to ₹10 lakh (about USD 10,500), the buyer's declaration closes the entry. |
| Advances: bank-set thresholds (Regs. 10 and 12) | Above its own limit, the bank can ask for a standby letter of credit or guarantee before an advance leaves India. |
| Each bank publishes its import policy (Reg. 19) | Documents, timelines, charges and extensions are written down, with an appeal route for customers. |
IDPMS is a ledger, not a gate. To clear Indian customs, the importer files a bill of entry, the customs declaration for the shipment. Its data reaches the bank through IDPMS, and the bank records each payment against it. An open entry shows you are unpaid; it does not stop payment.
Real holds and convenient excuses
A genuine hold always names a document, a check or a person; an excuse names only "the bank" or "the RBI".
Exhibit 2: What the buyer says, and how to tell which it is
| What you hear | Real when | An excuse when | Ask for |
|---|---|---|---|
| "We need RBI approval." | A transaction outside the 2026 Regulations, or one begun before 1 October 2026 that already needed RBI approval | Your invoice is an ordinary goods or services import on agreed terms | The bank's letter naming the rule |
| "It is past six months; the bank cannot pay." | Never on that ground now; past the contract date, the buyer asks its bank for an extension | Always, if the six-month rule is quoted | A copy of the extension request |
| "Bank compliance is reviewing it." | Sanctions or know-your-customer screening of your name, bank, country or goods; a name mismatch | No named document after a week | The bank's query, word for word |
| "The bill of entry is not matched." | Goods not yet cleared from customs or a bonded warehouse, or the entry details are wrong | Goods cleared weeks ago and the buyer holds the bill of entry | Bill of entry number, date and port code |
| "Tax forms are pending." | Services, software or royalties, where tax paperwork must reach the bank first | A plain goods invoice, which needs no tax information for the bank | The tax form acknowledgement number |
| "Your bank details do not match." | Account name differs from the invoice, a new account, or a third-party account | Details unchanged since earlier payments | Exactly which field differs |
| "The bank wants a guarantee from you." | An advance payment above the bank's threshold, or the buyer has older advances not yet matched to imports | Payment after shipment | The bank's written condition |
If tax forms are the reason, the issue is withholding, not FEMA: see when your Indian customer deducts tax. If every answer ends with "the bank", the money may not be there; check whether the buyer is still in business.
The solutions: six ways to move a payment the buyer says is stuck at its bank
Every route depends on the same thing: the buyer must answer the bank's query, so the work is getting that answer sent.
Exhibit 3: Options when an Indian buyer blames its bank
| Option | What it can do | What it cannot do | Right choice when |
|---|---|---|---|
| Handle it yourselves from abroad | Ask for the query, send documents, set a date | Reach the treasury team or see the bank's reply | The buyer answers you and the gap is a document you hold |
| Your lawyer at home | A formal letter on the contract terms | Read Indian banking practice or move an Indian treasury | The contract is under your law and you are preparing a claim |
| An Indian law firm | A FEMA opinion, a notice, mediation, a suit | Fix a missing document cheaply | The buyer refuses after a complete file, or a real FEMA question exists |
| A home-country agency that subcontracts in India | Reminders through a partner | Show you who works the file in India | Small, simple claims where visibility matters less |
| Your credit insurer's panel | Act within the policy's rules | Act without the insurer's consent | The receivable is insured; follow the policy first |
| GGA's India Desk | Work with the buyer's treasury and tax team on the bank's query in their city | Speak to the buyer's bank, which deals only with its customer | The buyer is trading and the hold is a file, not a dispute |
If the buyer disputes the goods or the price, the bank is not the issue; the pillar guide to recovering B2B debt from an Indian company covers the legal routes, and cost and time by route shows what each takes. A legal notice sent while a bank query is still open usually moves the file to the buyer's lawyers, not to its treasury.
What you can do this week
- Ask in writing for the name and branch of the buyer's AD bank, the exact document or check outstanding, and a copy of the bank's email or letter.
- Send a clean payment set: commercial invoice, packing list, bill of lading or airway bill, and a letter from your bank confirming your account name and number. The account name must match the invoice exactly.
- Ask for the bill of entry number, date and port code. If the goods are still in a bonded warehouse, ask when they will be cleared.
- For services or software, ask whether the buyer's tax form is with the bank, and send your tax residency certificate.
- If the contract date has passed, ask the buyer to request an extension from its own bank, and to copy you on the request.
- Read the bank's published import policy on its website.
- Once told "remitted", ask for the SWIFT reference. Your bank can trace it.
Why GGA: we work on the document the bank is waiting for
The bank answers your buyer; GGA works with your buyer's treasury team until the answer is sent.
- In India, in the buyer's city. From 17 Indian cities, a GGA specialist meets the treasury, payables and tax teams in their working hours.
- We read the bank query, not the excuse. We check the bank's written query against the 2026 Regulations and the bank's published policy. If no query exists, you know where the delay is.
- The bank's checklist, completed. We assemble exactly what the bank asked for, with the buyer's treasury. Your customer stays your customer.
- We never touch the payment. The buyer's bank pays your account. Bank details change only by your own letter.
- Counsel only if the file is complete and still unpaid. If the buyer then refuses, GGA coordinates the next step with Indian counsel once you approve it in writing.
- A written view when the story keeps changing. A Recovery Position Report shows where the payment really stands and what recovery is worth before you commit to a route. It costs from USD 1,500 per receivable, credited against success commission actually earned if GGA is then instructed.
GGA is not the answer under USD 20,000, for a FEMA opinion (Indian counsel's work) or for a buyer in insolvency. All topics are on the India Desk page.
What GGA would do
First establish whether a bank query exists; then close it; then track the money to your account.
- Days 1–3: File and claim check against the 2026 import rules. You receive: a note saying whether the stated reason can be real for this invoice, and what is missing from your side.
- Week 1: Find the open item. We ask the buyer's treasury for the bank's written query, the bill of entry details and the bank name. You receive: the query, or written confirmation that none exists.
- Weeks 1–2: Build the response. We assemble the documents the bank asked for with you and the buyer, and flag any tax question for your adviser. You receive: the response set and the date the buyer will lodge it.
- Weeks 2–4: Follow it through. We stay with the buyer's treasury until the bank accepts the file, including any extension request. You receive: a weekly status note and the remittance date once fixed.
- After payment: Reconcile. You receive: the SWIFT reference, the amount received against the invoice, and any shortfall raised with the buyer.
Terms: cases from USD 20,000; a file-opening fee and success commission agreed in writing before work begins; commission only on amounts actually recovered.
What we need from you
Four items are enough to tell you whether the bank story holds.
To start
- The buyer's full name and city, and the invoice amount, currency and due date
- The contract or purchase order payment terms
- The buyer's messages blaming the bank or the RBI
- Whether the invoice is for goods, services, software or a mix
To act
- Commercial invoice, packing list and bill of lading or airway bill
- Your bank's letter confirming the account name and number
- Bill of entry details, if the buyer shared them
- Tax residency certificate, for any service or software element
- Records of earlier payments from the same buyer, with SWIFT references
- Any advance-payment or guarantee terms in the contract
Missing some of these? Send what you have — telling you what is missing is part of the first reply.
How you stay in control
The buyer pays your account; any regulatory question goes to your advisers, not to GGA.
- Your buyer pays you directly. GGA never receives or holds your money.
- Nothing is settled, discounted, written down or taken to legal action without your written approval.
- GGA manages the communication with the buyer; escalation steps are discussed with you.
- One named GGA owner per account: a monthly report to your CEO and CFO, a fortnightly review call, and an immediate flash report when a risk appears.
- Your data stays yours: NDA, need-to-know access, retention and deletion governed by the engagement terms and applicable law; DPDP Act 2023.
- Fee and commission are agreed in writing before recovery begins. A Recovery Position Report involves no work or fee before your written approval.
- GGA gives no FEMA or tax opinion and signs nothing for you; those stay with your advisers or Indian counsel.
- GGA never asks a buyer to pay any other account.
Send us one unpaid invoice. Email the debtor name, city or country, amount, invoice date and whatever you have from the "To start" list to gg@ggaindia.co.in. Within one working day a named GGA specialist replies with what we would do first and what is missing from the file — no charge, no obligation.
A different situation? Indian company owed by an Indian customer → Customer not paying your invoice in India · Indian exporter owed by an overseas buyer → Global Receivables Desk
Frequently asked questions
Does an Indian company need RBI permission to pay a foreign supplier?
Not for an ordinary import of goods or services. Its AD bank handles the payment under the 2026 Regulations. RBI approval is needed only for transactions outside the rules, which an ordinary invoice is not.
Is there still a six-month limit for Indian import payments?
No. From 1 October 2026 the payment period follows the contract. If the buyer pays later than agreed, its own bank can extend the period on a reasoned request.
What is IDPMS, and can it block our payment?
The RBI's database linking each bill of entry to its payments. Banks mark an entry off once you are paid. An open entry records non-payment; it does not block one.
What can we ask our Indian buyer to show us?
The bank's written query, the bank name and branch, the bill of entry number and date, any extension request, and the SWIFT reference once paid. A buyer with a genuine hold can share these.
Can GGA contact the buyer's bank for us?
No. An Indian bank discusses payments only with its own customer. GGA works with the buyer's treasury team, which does.
Related questions for foreign creditors: Our Indian customer has no complaint about the goods but still has not paid. Why? · My Indian distributor has stopped paying. What can we do? · Country guides: UK · Europe · USA
Sources
- Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 — Reserve Bank of India
- A.P. (DIR Series) Circular No. 20, Export and Import of Goods and Services, 16 January 2026 — Reserve Bank of India
- Master Direction – Import of Goods and Services (superseded from 1 October 2026) — Reserve Bank of India
- Rule 220, Income-tax Rules, 2026 — Income Tax Department
- RBI issues EXIM guidelines (EY India)
- FEMA Export and Import Regulations 2026: role of AD banks (King Stubb & Kasiva)
This page summarises the position as at 9 November 2026. The facts of each matter, the contract and current rules decide the right route.