A S BANKA ADVISORS

If your startup bills overseas clients, 1 October 2026 is the day your export receivables move to a new rulebook. The Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026 replace the FEM (Export of Goods & Services) Regulations, 2015 from that date. The headline number does not change: you still have nine months to realise and repatriate export proceeds. What changes is the date from which those nine months run. For a services or software business, that date is now the date of the invoice.

Why you may have seen two different numbers

When RBI notified the new Regulations in January 2026 (Notification No. FEMA 23(R)/2026-RB dated 13 January 2026), regulation 5(1) said fifteen months, and eighteen months for exports invoiced or settled in Indian Rupees. On 22 September 2026, before the Regulations came into force, RBI amended that text (Notification No. FEMA 23(R)/(1)/2026-RB, published in the Gazette on 24 September 2026). Regulation 5(1) now reads nine months, and twelve months for rupee exports. The fifteen-month figure never takes effect. If your finance team planned collections around fifteen months, that plan needs to be reset now.

The new clock, export by export

Until 30 September 2026, RBI’s Master Direction on Export of Goods and Services (updated as on 17 July 2026) measures nine months from the date of export, and fifteen months from the date of shipment for goods sent to a warehouse abroad. Your AD bank may extend the period on your request, citing the reasons for the delay, if it is satisfied with them.

What this means for a SaaS or services startup

Every invoice is its own deadline. Monthly billing to one overseas client creates twelve realisation dates a year; milestone billing creates one per milestone. An invoice raised on 15 October 2026 has to be realised and repatriated by 15 July 2027, unless your AD bank extends the period. Your receivable ageing report is now also your FEMA compliance report.

The EDF follows the same invoice. Under regulation 3(2), an exporter of services files the Export Declaration Form within 30 days from the end of the month in which the invoice is raised. One EDF may cover all exports made in that month. An exporter of services other than software may file it on or before the date the payment is received.

Group billing can be netted, within limits. Regulation 7 lets the AD bank allow set-off of export receivables against import payables with the same overseas buyer or supplier, or with their overseas group or associate companies, within the realisation period. For an Indian company that bills a foreign parent and also pays it for shared costs, this is worth structuring deliberately rather than netting informally.

A stuck receivable has a long tail. Under regulation 13, if export proceeds stay unrealised for more than one year beyond the due date (or the extended period), the exporter may undertake further exports only against full advance or an irrevocable Letter of Credit. The regulation speaks of further exports by the exporter, not only exports to the client who has not paid.

Small invoices have a simpler exit. Where an invoice is up to Rs 10 lakh, the EDPMS entry can be closed on your declaration that payment has been realised in full or otherwise (regulation 4(2)), and a reduction in export value can be permitted on your declaration (regulation 6).

Other changes worth knowing

Each AD bank must have an internal policy covering extensions and adjustments of export proceeds, publish its main features on its website, and must not levy any charge or penalty for a regulatory delay or violation by the exporter (regulation 19). New regulation 20 moves to AD banks the handling of transactions undertaken before 1 October 2026 that earlier needed RBI approval. Exporters on RBI’s Caution List as on 30 September 2026 stay governed by that order until they are removed from the list. For goods shipped to a warehouse abroad before 1 October, the Regulations contain no separate transition rule, so confirm the applicable date for open entries with your AD bank.

Your checklist before 1 October

1. Re-age every open export receivable: services by invoice date, goods by shipment date, warehouse goods by date of sale.
2. Move rupee-invoiced exports to the twelve-month period.
3. Add the services EDF deadline to your monthly close.
4. Read your AD bank’s published policy on extensions before you need one.
5. Review intra-group billing and payables for set-off under regulation 7.

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Source: Reserve Bank of India, Notification No. FEMA 23(R)/(1)/2026-RB dated 22 September 2026, Foreign Exchange Management (Export and Import of Goods and Services) (Amendment) Regulations, 2026, rbi.org.in
Source: Reserve Bank of India, Notification No. FEMA 23(R)/2026-RB dated 13 January 2026, Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, rbi.org.in
Source: Reserve Bank of India, Master Direction: Export of Goods and Services, FED Master Direction No. 16/2015-16 (updated as on 17 July 2026), rbi.org.in

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A S Banka Advisors Private Limited. This article is for general information and is not legal advice.