Gold Card Scheme For Exporters

KEY LEARNING POINTS

1. Objective of the scheme
2. Eligibility for availing Gold card scheme
3. Sanctions of Credit limit
4. Benefits of the Gold card Scheme

Objective of the Scheme 

The Government (Ministry of Commerce and Industry), in consultation with RBI had indicated in the Foreign Trade Policy 2003-04 that a Gold Card Scheme would be worked out by RBI for creditworthy exporters with good track record for easy availability of export credit on best terms. Accordingly, in consultation with select banks and exporters, a Gold Card Scheme was drawn up. The Scheme envisages certain additional benefits based on the record of performance of the exporters. The Gold Card holder would enjoy simpler and more efficient credit delivery mechanism in recognition of his good track record.

Eligibility for availing Gold card scheme

• All creditworthy exporters, including those in small and medium sectors, with good track record would be eligible for issue of Gold Card by individual banks as per the criteria to be laid down by the RBI norms. 
• Exporters whose accounts have been classified as `Standard' continuously for a period of 3 years and there are no irregularities/ adverse features in the conduct of the accounts can avail Gold card scheme facility. 
• The scheme will not be applicable for those exporters who are blacklisted by ECGC or having overdue bills in excess of 10% of the previous year’s turnover.

Sanctions of Credit limit

The time frame for disposal of applications received for sanction of credit under the Gold Card Scheme would be as under: -

• Fresh applications will be sanctioned within 25 days
• Renewal of limits will be sanctioned within 15 days
• Sanction of adhoc limits will be done in 7 days

'In-principle' limits will be sanctioned for a period of 3 years with a provision for automatic renewal subject to fulfillment of the terms and conditions of sanction. In case of any misuse of the card or observance of any violation of the terms and conditions, the Bank will have the right to recall the Card at any time.

A stand-by limit of not less than 20 per cent of the assessed limit may be additionally made available to facilitate urgent credit needs for executing sudden orders. In the case of exporters of seasonal commodities, the peak and off-peak levels may be appropriately specified.

Benefits of the Gold card Scheme

• Taking into account the anticipated export turnover of the exporter, the bank can provide need-based business loan limits with a liberal approach. Card holders would be given preference in the matter of granting of packing credit in foreign currency. 
• Applicable rate of interest to be charged under the Gold Card Scheme will not be more than the general rate for export credit in the respective bank. In keeping with the spirit of the Scheme, banks will try to provide the best rates possible to Gold Card holders on the basis of their rating and past performance. 
• Banks would consider waiver of collaterals and exemption from ECGC guarantee schemes on the basis of card holder's creditworthiness and track record. 
• Issuing bank will further decide facilities of further value addition to their cards through supplementary services like ATM, Internet banking, International debit / credit cards. 
• Gold Card holders, on the basis of their track record of timely realization of export bills, will be considered for issuance of foreign currency credit cards for meeting urgent payment obligations, etc. 
• Banks may ensure that the PCFC requirements of the Gold Card holders are met by giving them priority over non-export borrowers with regard to granting loans out of their FCNR (B) funds, etc. 
• Banks will consider granting term loans in foreign currency in deserving cases out of their FCNR (B), RFC, etc. funds. (Banks may not grant such loans from their overseas borrowings under the 25 per cent window of overseas borrowings.)