Exporters in India play a significant role to elevate the economy. They help increase the inflow of foreign currency that holds higher value in the international market. However, exporters sometimes obscure their data to achieve optimum profit.
Therefore, the Reserve Bank of India introduced software called EDPMS to monitor exporters transaction details. This article consists of more information about this topic.
Knowing about RBI will help IAS Exam aspirants deal with other topics related to UPSC Indian Economy. This article will hence provide details about RBI and its functioning.
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The Indian Economy is one of the challenging subjects in the Civil Services Examination for many candidates. We bring you the following articles to drive your preparation in the right direction:
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What is EPDM?
RBI commenced a software Export Data Processing and Monitoring System in 2014. This is an online program for all Indian banks to record exporters’ transactions with them online. Thus, RBI can increase the transparency of records of dollar payment flow between India and abroad.
Process of Export Data Processing and Monitoring System
Below is the process that shows how Export Data Processing and Monitoring System works:
- Under this system, all the banks must download the softex forms or shipping bills that the shipping agencies issue. These agencies include Special Economic Zones (SEZ), Software Technology Parks of India (STPIs) and Customs.
- The banks also must download the entry bills that all the ports issue.
- They then compare these data with the inward remittance data that the export companies proceed with.
- This data set permits the banks to track each shipment, exported with all apparatus status straight away.
- Besides, it authorizes exporters to demand benefits faster.
Caution and De-caution List of Exporters in EDPMS
The Reserve Bank of India initially instructed the banks to be strict with exporters who avoid filing their shipment details. However, the export data remained obsolete even after numerous reminders to the exporters and banks.
Therefore, RBI automated the caution or de-caution list of exporters in 2016 as a part of EDPMS automation. It clearly warns the exporter to file their details within 2 years. According to this module, if any consigning bills against any exporter remain omitted, they will automatically be caution listed.
Being on this list hampers export procedure as these exporters are rejected packing credit. In addition, it causes non-negotiation of credit bills’ non-letter. It means that the banking documents will be delayed despite the timely delivery of the goods. It will cause the exporters to pay demurrage charges and extra costs.
Export Data Processing and Monitoring System Module
Below are some procedures under the Export Data Processing and Monitoring System Module:
- AD banks can recommend any exporter to be on the caution list according to their track record with that bank and investigating body.
- These banks will recommend to the concerned Regional Office of RBI’s Foreign Exchange Department if any exporter is prejudicial to these following agencies:
- Besides, these banks can recommend if-
- Any exporter is untraceable and/or
- Not endeavoring sincerely to register the paid or payable export proceeds
- However, AD banks may also recommend de-caution-list an exporter to RBI’s Regional Office.
Significance of Export Data Processing and Monitoring System
The Reserve Bank of India will gather some crucial data regarding export bills with this system. It will help discover the number of dollar remittances destined for India but floating abroad. This data will also determine the dimensions of hedging against Indian currency that can assist RBI to control Forex market operations.
Some exporters complain about their workforce shortage to fill up the essential data despite its importance. Some also are not interested in filling in their inward remittances details as the system creates transparency. Nevertheless, if RBI brings all exporters under EDPMS by strict regulations, it will improve India’s business environment.
Become familiar with the general pattern of the exam by visiting the UPSC Syllabus page. For more UPSC related preparation materials, visit the links given below:
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Frequently Asked Questions on EPDMS
What was RBI’s warning to exporters to ensure data updation before 31st December 2018?
RBI warned exporters who did not update their details to pass on their names to the Enforcement Directorate under FEMA. This warning was to ensure the updation of all the data before 31st December 2018.
Which banks can recommend exporters’ names for caution listing to the Reserve Bank of India?
The AD banks or Authorized Dealer Category -I Banks can recommend caution listing to the Reserve Bank of India.
What is the full form of EPDM?
The complete form of EPDM is Export Data Processing and Monitoring System.
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