Import Payments Under FEMA: The 2026 Framework
From October 1, 2026, the contract and the AD bank's policy set import timelines; the courseware still tests the old six-month rule.
Paying a foreign supplier is a current account transaction, and an AD bank handles it under FEMA. From October 1, 2026, the rules sit in the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026. They replaced the Master Direction on Import of Goods and Services (and its export counterpart), along with dozens of older import circulars.
The shift is from fixed RBI timelines to the underlying contract and the AD bank's own documented policy. The IIBF courseware and most question banks still carry the older Master Direction's numbers, so this page sets out both: what the current rule is, and what the older figures were.
You save ₹200 today
- 5 full-length mocks
- 553 questions, chapter by chapter
- Rate & risk calculations
One payment, no subscription · Valid for 2 months
An Import Payment, Start to Close
- 1
Import is recorded in IDPMS
The Import Data Processing and Monitoring System carries Bill of Entry data. For non-EDI ports and for import of services, the AD bank enters details within five working days of receiving the documents.
- 2
AD bank checks genuineness
The bank debits the importer's account only after satisfying itself that the transaction is genuine, and simultaneously updates or closes the IDPMS entry.
- 3
Payment within the contract period
The importer pays within the period in the underlying contract. On a request citing reasons, the AD bank may extend it.
- 4
Entry is marked off
Once payment is made the IDPMS entry is closed. For Bills of Entry or service invoices up to ₹10 lakh, closure may rest on the importer's declaration, including quarterly bulk declarations.
Old Figures vs the 2026 Framework
The left column is what the superseded Master Direction said and what older courseware tests.
Time to pay for imports
Master Direction (till Sept 30, 2026)
Not later than six months from the date of shipment
2026 Regulations (from Oct 1, 2026)
Within the period in the underlying contract; AD bank may extend
Evidence of import
Master Direction (till Sept 30, 2026)
Bill of Entry details (or Customs Assessment Certificate) within three months of remittance
2026 Regulations (from Oct 1, 2026)
AD bank marks off the IDPMS entry once payment for the import is made; details per its internal policy
Small-value closure
Master Direction (till Sept 30, 2026)
Entries of ₹10 lakh or less per bill could be closed on importer's declaration
2026 Regulations (from Oct 1, 2026)
Same ₹10 lakh threshold, now including quarterly bulk closure
Third-party payment
Master Direction (till Sept 30, 2026)
Allowed with a firm purchase order or tripartite agreement and invoice narration
2026 Regulations (from Oct 1, 2026)
Allowed if the AD bank is satisfied about bona fides
Interest on delayed payment
Master Direction (till Sept 30, 2026)
Payable only for up to three years from the date of shipment
2026 Regulations (from Oct 1, 2026)
Must not exceed the all-in-cost ceiling for trade credit under the Borrowing and Lending Regulations, 2018
| Point | Master Direction (till Sept 30, 2026) | 2026 Regulations (from Oct 1, 2026) |
|---|---|---|
| Time to pay for imports | Not later than six months from the date of shipment | Within the period in the underlying contract; AD bank may extend |
| Evidence of import | Bill of Entry details (or Customs Assessment Certificate) within three months of remittance | AD bank marks off the IDPMS entry once payment for the import is made; details per its internal policy |
| Small-value closure | Entries of ₹10 lakh or less per bill could be closed on importer's declaration | Same ₹10 lakh threshold, now including quarterly bulk closure |
| Third-party payment | Allowed with a firm purchase order or tripartite agreement and invoice narration | Allowed if the AD bank is satisfied about bona fides |
| Interest on delayed payment | Payable only for up to three years from the date of shipment | Must not exceed the all-in-cost ceiling for trade credit under the Borrowing and Lending Regulations, 2018 |
IDPMS, evidence of import and payment-period questions.
Other Rules That Sit Alongside
- Set-off
- The AD bank may allow export receivables to be set off against import payables with the same overseas buyer or supplier, or their overseas group or associate companies, within the export realisation period.
- Reduced-value settlement
- On the importer's request, the AD bank may close an IDPMS entry where the import was settled at a reduced value, if satisfied about the reasons.
- Internal policy and SOP
- Each AD bank must publish a documented policy covering documents, timelines, charges, extensions and advance payments, with an appeal route, and may not charge customers penalties for their regulatory delays.
- FETERS
- The Foreign Exchange Transactions Electronic Reporting System, through which the AD bank reports all foreign trade transactions to RBI.
How CCFE Tests This
Current question banks are built on the Master Direction, so expect "within how many months from shipment must import payment be made" (six) and "which document is evidence of import" (Bill of Entry). Answer those in the courseware's terms. The trap is mixing in export numbers: realisation periods for exports are a separate rule and have just changed again. If an exam question explicitly frames the October 2026 regulations, the answer is "as per the underlying contract".
FAQs
What is the time limit for import payment under FEMA?expand_more
From October 1, 2026, payment is due within the period in the underlying contract, and the AD bank may extend it on a reasoned request. The earlier Master Direction set a limit of six months from the date of shipment.
What is IDPMS?expand_more
The Import Data Processing and Monitoring System, in which AD banks record Bills of Entry and import payments, follow up on outstanding entries and mark them off once the import is paid for.
Can import payment be made to a third party?expand_more
Yes. Under the 2026 Regulations, an AD bank may permit third-party payments for imports if it is satisfied with the bona fides of the transaction.
What replaced the RBI Master Direction on import of goods and services?expand_more
The Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, with RBI's directions to AD banks, in force from October 1, 2026.
Next steps
- Advance Import Paymentsarrow_forward
- EDPMS & IDPMSarrow_forward
- Set-Off & Write-Offarrow_forward
- FEMA & Trade Finance Conceptsarrow_forward
100 timed questions across all six modules.