RBI Trade Payment Rules Leave International Credit Card Purchases in Grey Area
· Business · Economic Times
New Reserve Bank of India trade payment regulations effective October 1 require consumers to report international credit card transactions for services like Claude Pro, Bandcamp, and The New Yorker to banks. Authorized dealer banks must log import of service details on digital platforms within five working days of receiving documents. However, the framework lacks reporting mechanisms and clarity for personal service imports made by individuals under the Liberalised Remittance Scheme using credit cards. Furthermore, since traditional trade rules require submitting standard documents before remitting payments, how card-based instant payments will operate remains unclear. Experts note that these overseas vendor purchases also attract Goods and Services Tax.
Why it matters
Indian consumers and businesses paying for international software and subscription services face compliance uncertainty and potential reporting burdens under new central bank rules.
Read the original report — Economic Times
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