How to Change Your AD Bank for Export Payments
TL;DR - Summary
- What is an AD bank for export payments? - An Authorised Dealer (AD) bank for export payments is a bank licensed by the Reserve Bank of India under FEMA to deal in foreign exchange. While exporters can register multiple AD banks, payments for a specific shipment must generally be routed through the exact bank declared on its shipping bill.
- Why would an exporter need to change their AD bank? - An exporter may need to change their AD bank because of slow Foreign Inward Remittance Certificate (FIRC) turnaround, hidden charges, missing SWIFT corridor or currency support, a lack of digital workflows, a change in primary business banking relationship, or expansion into new markets or currencies.
- How do you change your AD bank for export payments, step by step? - You change your AD bank for export payments in five steps: notify your current AD bank in writing, collect all pending FIRCs and close out outstanding remittances, update the AD bank linked to your Importer Exporter Code (IEC) on the DGFT portal, submit a formal declaration to your new AD bank, and update your export invoices and contracts.
- What happens to pending FIRCs during the switch? - FIRCs already issued by your old AD bank remain valid for GST refund claims, electronic Bank Realisation Certificate (eBRC) generation, and export incentive applications, and the old AD bank remains obligated to issue the FIRC for any payment already in transit to it.
What Is an Authorised Dealer (AD) Bank for Exports?
An Authorised Dealer (AD) bank is a bank licensed by the Reserve Bank of India under FEMA to deal in foreign exchange. For Indian exporters, it is the designated bank through which all export remittances must be received and reported.
While Indian exporters can maintain multiple AD banks and hold multiple AD Codes under a single Importer Exporter Code (IEC), you are legally required to route export proceeds for a specific shipment through the exact AD bank declared on that shipment's customs documentation (shipping bill). If you want to switch banks for an ongoing transaction or consolidate all future exports to a new primary bank, you must follow a formal transfer process.
Take a Pune-based software exporter receiving $5,000 from a US client. That payment must be credited through their designated AD bank, which then issues the Foreign Inward Remittance Certificate (FIRC) and handles the statutory reporting. Crediting it to just any savings account at any bank doesn't meet the requirement.
✅ PRO TIP
Check your IEC registration on the DGFT portal to confirm which bank is currently listed as your AD bank before initiating any switch.
Why Would an Exporter Need to Change Their AD Bank?
An exporter may need to change their AD bank because of slow FIRC turnaround, hidden or unpredictable charges, missing support for specific SWIFT corridors or currency pairs, a lack of digital workflows, a change in primary business banking relationship, or expansion into new markets or currencies.
- Slow FIRC turnaround: If your current bank takes weeks to issue a Foreign Inward Remittance Certificate, it delays GST refund claims and export incentive applications.
- Hidden or unpredictable charges: Banks often apply undisclosed forex conversion margins and SWIFT handling fees that erode the export proceeds you actually receive.
- Unsupported SWIFT corridors or currency pairs: Some AD banks do not support specific SWIFT corridors or currency pairs. For example, a bank may not efficiently process GBP or AUD remittances, which forces you to take a loss on conversion or face delays.
- No digital workflows: Exporters sometimes switch when their current AD bank requires RM calls, physical SWIFT copy submissions, or branch visits for routine compliance tasks.
- A new primary banking relationship: Moving to a new bank for working capital or trade finance often makes it practical to consolidate the AD bank function there as well.
- New markets or currencies: If you're scaling to new markets or currencies, your current AD bank's correspondent banking network may be insufficient for the new geographies.
✅ PRO TIP
Before switching, request a full fee schedule from your current AD bank in writing. You may discover charges you were unaware of, which strengthens the case for switching.
How Do You Change Your AD Bank for Export Payments?
Changing your AD bank for export payments takes five steps: (1) notify your current AD bank in writing, (2) collect all pending FIRCs and close out outstanding remittances, (3) update the IEC–AD bank linkage on the DGFT portal, (4) register your new AD Code on ICEGATE, (5) submit a formal declaration to your new AD bank, and (6) update your export invoices and contracts going forward to reflect the new banking details.
Step 1: Notify Your Current AD Bank in Writing
- Submit a written request to your existing AD bank stating your intent to change the designated AD bank for export remittances, and keep an acknowledged copy for your records.
- Ask the bank to confirm in writing that no export remittances are pending or outstanding under your IEC. This confirmation protects you during the transition.
Step 2: Collect All Pending FIRCs From the Old AD Bank
- Before closing out with the old AD bank, obtain FIRCs for every export remittance you have already received. The old bank remains responsible for issuing FIRCs on payments credited to it even after you switch.
- Make sure all electronic Bank Realisation Certificates (eBRC) linked to the old AD bank's FIRCs are generated and available before the formal switch.
Step 3: Update the IEC–AD Bank Linkage on the DGFT Portal
- Log in to the DGFT portal (dgft.gov.in) using your IEC credentials, go to the IEC profile modification section, and update the bank account details to reflect the new AD bank.
- The updated bank account must be an active current account in the name of the IEC holder at the new AD bank.
Step 4: Register the New AD Code on ICEGATE
- To export goods and generate shipping bills using your new bank, you must register the new bank’s 14-digit AD Code with Customs via the ICEGATE portal.
- Without this crucial step, the customs EDI system will not process your shipping bills, and the Export Data Processing and Monitoring System (EDPMS) won't track your foreign exchange realization.
Step 5: Submit a Declaration to the New AD Bank
- Submit a formal declaration to the new AD bank confirming that you are designating it as your AD bank for export remittances. This triggers the bank's KYC and onboarding process for export accounts.
- Provide the new AD bank with your IEC copy, GST registration, export licence (if applicable), and business address proof.
Step 6: Update Export Invoices and Contracts
- All future export invoices must carry the new AD bank's account details (typically the bank's SWIFT code and your account number), so your foreign buyers remit funds to the correct account.
- Inform your existing foreign clients of the change in writing, and update any long-term contracts that specify payment routing instructions.
What Documents Do You Need to Switch Your AD Bank?
Switching your AD bank involves documents at three submission points. Your current AD bank gets your written request or closure letter and gives you an acknowledgement of no pending remittances plus your outstanding FIRCs or eBRC copies. Your new AD bank gets your IEC copy, GST registration certificate, business address proof, new account proof, a formal AD bank declaration letter, and your export licence or RCMC if applicable to your export category. The DGFT portal gets your latest IEC copy and your updated bank account details (account number, IFSC, SWIFT).
| Document | Submitted To |
|---|---|
| Written request / closure letter for AD bank change | Current AD bank |
| Acknowledgement of no pending remittances | Current AD bank (to receive from them) |
| All outstanding FIRCs / eBRC copies | Collect from current AD bank |
| IEC copy (latest) | New AD bank + DGFT portal update |
| GST registration certificate | New AD bank |
| Business address proof (utility bill / lease) | New AD bank |
| Cancelled cheque / bank account proof of new account | New AD bank |
| Formal AD bank declaration letter | New AD bank |
| Updated bank account details (account number, IFSC, SWIFT) | DGFT portal (IEC profile modification) |
| Export licence / RCMC (if applicable to your export category) | New AD bank |
✅ PRO TIP
Keep a physical and digital copy of every document you submit to both the old and new AD bank, in case of a FEMA inquiry during or after the transition.
What Happens to Pending Remittances and FIRCs During the Switch?
Any payment already in transit to your old AD bank will be credited there, and the old AD bank remains obligated to issue the FIRC for that transaction even after you have formally switched. FIRCs the old AD bank has already issued remain valid and can be used for GST refund claims, eBRC generation, and export incentive applications. Changing your AD bank does not invalidate them.
- In-transit payments: For payments that are invoiced but not yet received when you switch, the safest approach is to wait for the funds to arrive and for the old bank to issue the FIRC before you complete the DGFT update. This prevents split-record situations.
- New export invoices: Do not route new export invoices to the old AD bank once the switch is initiated. Any remittance that arrives at the old bank after the DGFT linkage has been updated creates a mismatch that requires manual resolution.
- Late arrivals at the old bank: If a remittance arrives at the old AD bank after the DGFT linkage has been updated to the new bank, contact the old AD bank immediately to ensure proper reporting under FEMA. Do not let such receipts go unacknowledged.
- Cut-off register: List every outstanding invoice with its expected payment date and amount. Confirm receipt and FIRC issuance for each one before you formally close out with the old AD bank.
If you'd rather not depend on a single AD bank's pace, Skydo gives Indian exporters virtual accounts across six currencies (USD, EUR, GBP, SGD, AUD, CAD) with automatic FIRC delivery for every transaction. That way you're never fully dependent on one AD bank's speed, fees, or SWIFT corridor access. Pricing is $19 flat under $2,000 and $29 flat from $2,000 to $10,000, with 0.3% over $10,000. Setup takes 10 to 15 minutes.
✅ PRO TIP
Ask your old AD bank for a written "no dues" confirmation listing all remittances received and FIRCs issued under your IEC. This is your clean-break record.
How Long Does It Take to Change an AD Bank for Exports?
Changing an AD bank for export payments typically takes 2 to 4 weeks from start to finish. The exact time depends on how quickly the old AD bank issues pending FIRCs and how fast the new AD bank completes KYC onboarding.
- DGFT portal update: Once you have the new bank account details and your IEC credentials ready, the update is generally completed within 1 to 3 working days.
- Old bank FIRCs and confirmation: The slowest step is usually collecting all outstanding FIRCs and the "no pending remittances" confirmation from the old AD bank. Banks that operate on manual workflows can take 1 to 2 weeks for this alone.
- New bank onboarding: KYC, export account activation, and SWIFT setup add another 5 to 7 working days, depending on the bank.
- Front-loading the process: If you notify the old bank early, track all outstanding invoices, and start new bank KYC at the same time, you can compress the total timeline to under 2 weeks.
⚠️ COMMON MISCONCEPTION
There is no single government-mandated deadline for completing an AD bank switch. The timeline is driven by bank processing speeds and by how many outstanding transactions need to be cleared first.
What Are the FEMA Compliance Risks During an AD Bank Transition?
The primary FEMA compliance risk during an AD bank transition is receiving export remittances into an account that is not yet formally designated as the AD bank account, which can result in non-compliance notices under FEMA for unreported or improperly reported foreign exchange receipts. Other risks are missing the prescribed realization period, a records mismatch if the DGFT linkage is updated too early, interrupted eBRC generation, and delayed FIRCs from the old bank.
- Realization period keeps running: Changing AD banks does not pause or extend the timeline by which export proceeds must be realized and reported. The obligation continues uninterrupted, so failing to report within the prescribed realization period remains a risk.
- Records mismatch: If the DGFT IEC linkage is updated to the new bank before all in-transit remittances have cleared the old bank, the payment sits at the old bank while your IEC points to the new one. That creates a reporting gap that may attract scrutiny.
- eBRC generation: Make sure eBRC generation is not interrupted during the transition. Any shipment bill for which the Inward Remittance Message (IRM) has not been mapped and eBRC generated remains an open compliance item regardless of the bank switch.
- Delayed FIRCs: If the old AD bank does not issue FIRCs, or issues them late, you may be unable to demonstrate receipt of export proceeds against specific invoices. That can indirectly cause FEMA risk, so keep written records of your follow-ups with the old bank.
- Penalties: FEMA penalties for non-realization or misreporting of export proceeds can be significant. The transition window is the period of highest risk because your documentation is split across two banks.
⚠️ WATCH OUT
Any export remittance received into an account not linked to a valid AD bank declaration, even temporarily during the switchover, can trigger a FEMA non-compliance notice. Do not direct foreign buyers to the new account until the DGFT update is confirmed.
How Does Skydo Reduce Your Dependency on a Single AD Bank?
Delays, hidden fees, manual FIRC chasing, and SWIFT corridor limitations at a single AD bank are the problems this article keeps coming back to. They are also what Skydo is built to solve for Indian exporters.
- Virtual accounts in six currencies: Skydo provides free virtual accounts in USD, EUR, GBP, SGD, AUD, and CAD. You can receive cross-border payments across multiple corridors without being limited by your AD bank's correspondent network.
- Automatic FIRC: Every transaction through Skydo comes with a free FIRC certificate, automatically. There is no chasing the bank, no manual requests, and no delay in your GST refund or incentive application timeline.
- Pricing: Fees are $19 flat under $2,000, $29 flat from $2,000 to $10,000, and 0.3% over $10,000. You know exactly what you will pay before the payment arrives, so there are no unpredictable bank forex margins.
- eBRC closure assistance: Link your DGFT account once, then bulk-upload shipping bills to auto-map IRMs and generate eBRC in a click. That removes the manual follow-up that delays compliance.
- Settlement: Settlement is guaranteed within 1 working day. There are no unpredictable timelines, no waiting on RM availability, and no SWIFT copy submission required.
- Setup and fees: Setup takes 10 to 15 minutes, with no monthly fees. You pay only when you transact.
You keep your designated AD bank for statutory compliance (IEC linkage, EDPMS, formal reporting) and use Skydo alongside it for faster, cheaper, and more transparent receipt of foreign payments.
How long does it take to change an AD bank for export payments?
The full process typically takes 2 to 4 weeks. The DGFT portal update takes 1 to 3 working days, but collecting outstanding FIRCs and completing new AD bank KYC are the slower steps.
Will my old FIRCs still be valid after switching AD banks?
Does changing my AD bank affect my GST refund linkage?
Can I have more than one AD bank for export payments?
