RBI circular dated 6th August, 2021 allowing banks to use any other alternative reference rate in respect of export credit in foreign currency, in view of the discontinuance of the LIBOR system.
Please refer to Master Circular DBR.No.DIR.BC.14/04.02.002/2015-16 dated July 1, 2015 on Rupee / Foreign Currency Export Credit and Customer Service to Exporters.
2. As per the extant guidelines, authorized dealers are permitted to extend Pre-shipment Credit in Foreign Currency (PCFC) to exporters for financing the purchase, processing, manufacturing or packing of goods prior to shipment at LIBOR/EURO LIBOR/EURIBOR related rates of interest.
3. In view of the impending discontinuance of LIBOR as a benchmark rate, it has been decided to permit banks to extend export credit using any other widely accepted Alternative Reference Rate in the currency concerned. All other instructions in this regard shall remain unchanged.