Mumbai, Sept. 16: The Reserve Bank of India (RBI) today further liberalised the automatic route for prepayment of external commercial borrowings (ECBs) by which any borrower may prepay his outstanding of up to $ 100 million without the apex bank’s prior permission.
Today’s order was aimed at enabling companies take advantage of the low international interest rates. The liberalised automatic route is available to all category of borrowers, irrespective of the residual maturity or percentage of the outstanding loan, as long as the amount being prepaid does not exceed $ 100 million. Earlier, this facility was available for prepayment up to $ 50 million subject to certain conditions, such as residual maturity not exceeding one year.
“Designated branches of authorised dealers may allow such remittances for prepayment of ECBs after obtaining a certificate from auditors that the applicant has availed of the ECB in accordance with all relevant Acts, rules/regulations and guidelines,” the RBI added.