TITLE: India's Reserve Bank Issues Reporting Guidance on Foreign Exchange Management Guarantees Regulations
BODY:
On April 1, 2026, the Reserve Bank of India (RBI) issued circular RBI/2026-27/02 providing reporting requirements and operational guidance for authorised persons under the Foreign Exchange Management (Guarantees) Regulations, 2026 (FEMA 8 (R)).
The circular establishes a standardised reporting framework for guarantee-related transactions. Authorised persons must use three designated forms to report guarantee activity: Form GRN Issue for reporting guarantee issuance; Form GRN Modification for reporting changes to guarantee terms, including guarantee amount, period extension, or pre-closure; and Form GRN Invocation for reporting guarantee invocation. Authorised dealer banks must submit these returns to the RBI within thirty calendar days from the end of each respective quarter through the Centralised Information Management System (CIMS) at https://sankalan.rbi.org.in.
For each guarantee issuance reported via Form GRN Issue, authorised dealer banks must provide a unique Guarantee Transaction Number before submission. The circular also specifies late submission fee computation methodology: for delayed Form GRN Invocation reporting, the amount involved is the liability created towards the surety on invocation; for delayed Form GRN Issue and Form GRN Modification reporting, the amount is considered nil as these returns do not capture flows.
Authorised persons are required to communicate the circular's contents to their customers and constituents. The directions are issued under sections 10(4), 11(1), and 11(2) of the Foreign Exchange Management Act, 1999, and take effect immediately.
REFERENCE:
Reserve Bank of India. Reporting under Foreign Exchange Management Act, 1999 – Returns pertaining to Foreign Exchange Management (Guarantees) Regulations, 2026. RBI/2026-27/02 A.P. (DIR Series) Circular No. 01. April 1, 2026. https://www.rbi.org.in