The Reserve Bank of India has notified the Foreign Exchange Management (Guarantees) Regulations, 2026, superseding Notification No. FEMA 8/2000-RB, to consolidate and regulate guarantees involving persons resident outside India. The regulations prescribe conditions under which a person resident in India may act as a surety, principal debtor or creditor, subject to FEMA permissibility of the underlying transaction and eligibility under the Borrowing and Lending framework, with specific exemptions for AD banks, IFSC units, overseas investment-related guarantees and certain statutory guarantees. A general prohibition applies unless guarantees are issued in accordance with these regulations or with RBI permission.
The regulations introduce a uniform quarterly reporting framework for all guarantees covering issuance, modification and invocation, with clear allocation of reporting responsibility among the parties, to be submitted to Authorised Dealer banks for onward reporting to RBI. A Late Submission Fee mechanism has been prescribed for delayed reporting to strengthen compliance. The regulations come into force from the date of publication in the Official Gazette.
Link –https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=13269&Mode=0
