What Are the RBI Rules on Direct Dispatch of Export Documents by Exporters?

Direct dispatch of export documents is when the exporter sends the shipping documents for a consignment straight to the overseas buyer or the buyer's agent. The usual route is through the AD bank, which sends the documents to its overseas branch or correspondent and releases them against payment or acceptance.

• Normal route: Under the old Master Direction, AD banks were told to normally dispatch shipping documents to their overseas branches or correspondents expeditiously (para C.10(i)).
• Why it matters: Documents such as the bill of lading give the buyer control over the goods. Once the buyer holds them without paying, the bank has no document-based hold on the shipment.
• Old exception: Banks could send documents direct to the consignee where full advance or an irrevocable letter of credit covered the shipment and the contract or LC provided for it (para C.10(i)(a)).
• Supersession: The Master Direction on Export of Goods and Services and the 13 August 2008 circular on direct dispatch of shipping documents stand superseded from 1 October 2026 (A.P. (DIR Series) Circular No. 20, para 4 and Annex A item 44).
• Current rules: The 2026 Regulations do not contain a separate rule on who dispatches shipping documents (FEMA 23(R)/2026-RB). They focus on declaration, realisation and EDPMS closure.

Direct dispatch is a goods concept. Service exporters and freelancers send invoices to clients directly as a matter of course, and their bank obligations sit in the EDF and realisation rules. See EDF form for exports.

Any goods exporter can ask to use direct dispatch of export documents, and the AD bank decides under its own policy from 1 October 2026. The old Master Direction named three groups: shipments covered by advance or LC, regular customers with a good track record, and status holder exporters or SEZ units.

You dispatch export documents directly by agreeing the method with the buyer in the contract, getting your AD bank's agreement under its policy, and then sending the documents yourself. The payment must still come through your AD bank so it can close the EDPMS entry.

1. Write direct dispatch into the sale contract or letter of credit, so the buyer's terms and the documents match.
2. Check your AD bank's export policy. Every AD bank must have a documented internal policy and SOP listing documents, timelines and charges for each process (Regulation 19(1)(a)), and disclose its main features on its website (Regulation 19(4)).
3. Declare the export. For goods, the EDF is furnished at the time of export, and at an EDI port it is deemed part of the shipping bill (Regulation 3(1)).
4. Tell your AD bank, in writing, that you are sending the documents directly, and give it copies of the invoice and transport document if its policy asks for them.
5. Send the original documents to the buyer or the buyer's agent by a traceable courier or electronic channel, and keep proof of delivery.
6. Make sure the buyer pays into your account with the AD bank. The bank credits the account only after satisfying itself that the transaction is genuine, and at the same time closes or updates the EDPMS entry (Regulation 4(2)).
7. Track realisation against the deadline of nine months from shipment, or twelve months for INR invoicing or settlement (Regulation 5(1)). See export realisation period.

Direct dispatch of export documents has no deadline of its own. The deadlines that apply are the EDF at the time of export and realisation within nine months of shipment. Your AD bank's policy sets which copies it needs from you.

If a buyer does not pay after direct dispatch of export documents, the export stays unrealised and the EDPMS entry stays open. The bank will follow up with you. After one year past the due or extended date, you can export only against full advance or an irrevocable letter of credit.

• Lost leverage: The buyer may already hold the documents needed to take delivery, so the bank cannot withhold them to secure payment.
• Bank follow-up: Banks must monitor open EDPMS entries and follow up with the exporter for documents needed to close them (Regulation 18(1)(f)).
• Extension: You can ask the bank for more time to realise, citing reasons, before the period runs out (Regulation 5(1), second proviso). See extension of export realisation period.
• Reduction: If the buyer pays less, the bank may allow a reduction in export value; up to ₹10 lakh per shipping bill this can be on your declaration (Regulation 6).
• Restriction: Proceeds unrealised beyond one year from the due or extended date limit further exports to full advance or an irrevocable LC (Regulation 13). See export proceeds not realised.
• Bank charges: The bank must not levy charges or a penalty on you for a regulatory delay or violation, and its charges must be reasonable (Regulation 19(3)).

Contact the buyer in writing, collect proof of dispatch and delivery, and ask your AD bank for an extension or reduction with reasons before the realisation period ends. If the bank declines, use the escalation and appeal route in its SOP. For write-off options, see write-off of unrealised export bills.

The FEMA regulations in force from 1 October 2026 do not name direct dispatch of export documents. From that date, the topic falls under the general duties in the FEMA (Export and Import of Goods and Services) Regulations, 2026 and each AD bank's internal policy. Para C.10 of the old Master Direction covered it until 30 September 2026.

• No bank consent: Sending documents straight to the buyer without telling the AD bank leaves the bank unable to match the later payment to the shipping bill.
• Open terms: Using direct dispatch on open account with a new buyer removes the document hold that protects you if the buyer does not pay.
• Wrong account: Letting the buyer pay to a different bank without telling both banks. For advances, the advance and realisation must go through the same AD bank unless you tell both banks of the change (Regulation 10(1)).
• Old rules: Relying on the 21-day duplicate EDF rule or other para C.10 conditions as current law after 1 October 2026.
• No proof: Not keeping courier receipts, emails and delivery proof, which the bank may need to accept extension, reduction or write-off requests.
• Missed dates: Waiting until after the realisation period ends before asking the bank for an extension.

Every rule, deadline and form on this page is linked to its official source, checked on the dates below.

1. Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, Notification FEMA 23(R)/2026-RB dated 13 January 2026, amended up to 22 September 2026, Regulations 3(1), 3(3), 4(2), 5(1), 6, 10(1), 13, 18(1)(a), (f), (g), 19(1), 19(2), 19(3), 19(4), 20 (checked 8 Oct 2026)
2. RBI A.P. (DIR Series) Circular No. 20, RBI/2025-26/194: Export and Import of Goods and Services, 16 January 2026, Paras 2, 3, 4 and 7; Annex A item 44 (A.P. (DIR Series) Circular No. 06 of 13 August 2008, Direct Dispatch of Shipping Documents) (checked 8 Oct 2026)
3. RBI Master Direction: Export of Goods and Services (FED Master Direction No. 16/2015-16), superseded from 1 October 2026, Paras C.10(i), (ii), (iii) and C.23.4 (checked 8 Oct 2026)