Module: | KYC, NPAs, Advances & Investment Valuations
Q205: Based on the Reserve Bank of India guidelines for export finance, consider the following statements regarding processing timelines and decision-making:
1. Banks are mandated to speed up the process of issuing Gold Cards to eligible exporters and ensure the process is completed within a strict period of three months.
2. The sanction of fresh or enhanced export credit limits must be made within exactly 45 days from the receipt of the completed application.
3. The renewal of existing export credit limits must be executed by the bank within 30 days from the receipt of the application.
4. Applications for ad hoc export credit facilities (other than for Gold Card holders) must be processed within 15 days.
5. Banks must reduce intervening layers in the sanctioning process to ensure that the total number of layers involved in decision-making for export finance does not exceed three.
Which of the statements given above is/are correct?
2. The sanction of fresh or enhanced export credit limits must be made within exactly 45 days from the receipt of the completed application.
3. The renewal of existing export credit limits must be executed by the bank within 30 days from the receipt of the application.
4. Applications for ad hoc export credit facilities (other than for Gold Card holders) must be processed within 15 days.
5. Banks must reduce intervening layers in the sanctioning process to ensure that the total number of layers involved in decision-making for export finance does not exceed three.
Which of the statements given above is/are correct?
✅ Correct Answer: D
The correct answer is D. All statements are mathematically and procedurally correct based on the strict regulatory directives.
Statement 1 is correct: The regulatory framework mandates a 3-month timeline for the issuance of Gold Cards to eligible exporters to facilitate trade.
Statement 2 is correct: The rules set a 45-day hard limit for the sanctioning of fresh or enhanced export credit limits.
Statement 3 is correct: The operational guidelines also dictate a 30-day timeline for the renewal of existing export credit limits.
Statement 4 is correct: The mandate requires a 15-day turnaround for ad hoc credit requests to ensure rapid liquidity for exporters.
Statement 5 is correct: The framework strictly caps the internal bureaucratic hierarchy, ordering banks to restrict decision-making layers for export finance to a maximum of exactly three layers.
Statement 1 is correct: The regulatory framework mandates a 3-month timeline for the issuance of Gold Cards to eligible exporters to facilitate trade.
Statement 2 is correct: The rules set a 45-day hard limit for the sanctioning of fresh or enhanced export credit limits.
Statement 3 is correct: The operational guidelines also dictate a 30-day timeline for the renewal of existing export credit limits.
Statement 4 is correct: The mandate requires a 15-day turnaround for ad hoc credit requests to ensure rapid liquidity for exporters.
Statement 5 is correct: The framework strictly caps the internal bureaucratic hierarchy, ordering banks to restrict decision-making layers for export finance to a maximum of exactly three layers.