Unrealised Export Bill Write-Off: RBI Rules & Process
TL;DR - Summary
- What is an unrealised export bill write-off? - An unrealised export bill write-off is the formal RBI-permitted process by which an Indian exporter permanently removes an unpaid export invoice from their outstanding receivables when payment from the overseas buyer has not come in and is not expected to.
- What are the three categories of unrealised export bill write-off under RBI rules? - The three categories are self write-off up to 10% of the previous calendar year's realised export proceeds, Authorised Dealer (AD) bank authorised write-off beyond that limit, and RBI approved write-off for cases outside AD bank authority, such as caution-listed exporters.
- How does the AD bank write-off process work for an unrealised export bill? - To write off an unrealised export bill through an Authorised Dealer (AD) bank, you apply with a full document set that includes a bank certificate of non-realisation, the AD bank evaluates your application, and it refers the case to RBI if the case falls outside its authority.
- What must an exporter do after an unrealised export bill write-off is approved? - After an unrealised export bill write-off is approved, the AD bank must still close the shipping bill in EDPMS separately because the write-off does not clear the entry automatically, and you may need to report the write-off separately for GST and DGFT.
What Is a Write-Off of an Unrealised Export Bill?
A write-off of an unrealised export bill is the formal RBI-permitted process by which an Indian exporter permanently removes an unpaid export invoice from their outstanding receivables when payment from the overseas buyer has not come in and is not expected to.
You need this process because you can't just delete the invoice from your records when a foreign buyer defaults, goes insolvent, or simply stops responding. RBI's EDPMS system is still tracking the invoice as an open export obligation, so you must follow a defined procedure to close it.
Here's an example. A Pune-based IT services firm raised an invoice of $5,000 on a US client. After six months of follow-up, the client is unreachable. The firm cannot simply write it off in their books. They must apply through their Authorised Dealer (AD) bank to formally extinguish the obligation in EDPMS.
⚠️ COMMON MISCONCEPTION
A write-off is a different thing from a waiver or a cancellation. The invoice existed and the export happened. The write-off formally closes only the receivable under RBI rules.
Which Exporters Can Apply for a Write-Off, and When?
Exporters of both goods and services can apply for a write-off when export proceeds have not been realised within the prescribed period and payment from the overseas buyer is not expected. The route you take depends on the bill: you can self write-off up to 10% of the previous calendar year's realised export proceeds, you approach your AD bank beyond that limit, and cases outside AD bank authority, such as caution-listed exporters, go from the AD bank to RBI.
- Unrealised within the prescribed period: any invoice where export proceeds have not been realised within the prescribed period is eligible, whether the export was a physical shipment or a service delivery.
- Partially realised bills: if part of the invoice has been paid, you can apply to write off only the unrealised balance.
- Documented recovery effort: AD banks expect a sustained, documented recovery attempt spanning multiple contacts before approving a write-off. A single demand email is rarely enough.
- Route by size and case: you can write off on your own up to 10% of the total export proceeds realised in the previous calendar year. Beyond that limit, you approach your AD bank. Cases outside AD bank authority, such as caution-listed exporters, are referred by the AD bank to RBI.
💡 QUICK INSIGHT
The write-off process applies to both goods and services exporters. It is not limited to those who ship physical cargo.
What Are the Three Categories of Export Bill Write-Off?
RBI rules give three categories of export bill write-off. Self write-off lets you close a bill yourself, up to 10% of the total export proceeds realised in the previous calendar year, with no AD bank approval needed. AD bank authorised write-off applies beyond that limit, when you approach your AD bank. RBI approved write-off covers cases outside AD bank authority, such as caution-listed exporters, where the AD bank refers the case to RBI.
| Category | Eligibility Cap | Who Initiates | Timeline | Documentation Level |
|---|---|---|---|---|
| Self Write-Off | Up to 10% of previous calendar year's realised export proceeds | Exporter directly | Faster; no bank approval wait | Lower - internal records + evidence of non-realisation |
| AD Bank Authorised Write-Off | Beyond self-write-off limit; exporter approaches AD bank | AD bank on exporter's application | Depends on bank processing | Higher - full document set required |
| RBI Approved Write-Off | Cases outside AD bank authority (e.g. caution-listed exporters) | AD bank refers to RBI | Longest | Highest - RBI-level scrutiny |
Not every write-off goes to RBI for approval. Most cases are handled either by you within the self-write-off limit or by your AD bank.
How Does the AD Bank Write-Off Process Work, Step by Step?
To write off an export bill through your AD bank, you apply with your full document set and the bank evaluates your application. If the case falls outside the bank's authority, such as for caution-listed exporters, the AD bank refers it to RBI. After the write-off, the AD bank must close the shipping bill in EDPMS as a separate step.
- Application: when the bill is beyond your self-write-off limit, you approach your AD bank, which acts on your application. A full document set is required.
- Certificate of non-realisation: the AD bank issues a bank certificate of non-realisation confirming the proceeds have not been received. It is part of the document set.
- Evaluation: the timeline depends on bank processing.
- Referral to RBI: for cases outside AD bank authority, such as caution-listed exporters, the AD bank refers the case to RBI.
- EDPMS closure: the write-off does not clear the EDPMS entry automatically. The AD bank must close the shipping bill in EDPMS separately.
When an AD bank evaluates your write-off application, one of the things it looks for is documentary evidence that the payment was genuinely attempted and received (even partially).
If you had collected your international payments through Skydo, you would already hold a free Foreign Inward Remittance Certificate (FIRC) for every inward remittance. That transaction-level certificate partially satisfies the AD bank's evidence requirement and reduces the friction of assembling your write-off file. Skydo issues FIRC/BIRC at no extra cost for every transaction, with no chasing required.
What Documents Do You Need to Write Off an Export Bill?
To write off an export bill, you file the GR/SDF form, the shipping bill, a copy of the export invoice, your correspondence with the overseas buyer, and a bank certificate of non-realisation with your AD bank. Where applicable, you add a legal notice or proof of dispute, insolvency or buyer default, and a FIRC/BIRC for any partial realisation.
- GR/SDF form: the original export declaration form filed at the time of shipment.
- Shipping bill: the customs-cleared export document evidencing the goods/services left India.
- Copy of the export invoice: the original invoice raised on the overseas buyer.
- Correspondence with the overseas buyer: emails, WhatsApp messages and written notices showing genuine attempts to recover payment.
- Bank certificate of non-realisation: issued by the AD bank, confirming the proceeds have not been received.
- Legal notice or proof of dispute, insolvency or buyer default: where applicable.
- FIRC/BIRC for any partial realisation: if part of the invoice was paid, the certificate covering that portion.
A partial FIRC covering the portion you already received strengthens your case for writing off the balance. It shows the transaction was genuine and only partly defaulted.
What Happens After the Write-Off, What Must You Still Do?
After a write-off is approved, the AD bank must still close the shipping bill in EDPMS separately, because approval does not clear the EDPMS entry automatically and delays in closing it trigger caution-listing. A write-off also does not remove the export from your GST return or DGFT records, so you may still need to report it separately to avoid a mismatch notice.
- EDPMS closure: many exporters believe a write-off clears the EDPMS entry automatically. It does not. The AD bank closes the shipping bill in EDPMS as a separate step, and delays here trigger caution-listing.
- GST and DGFT records: writing off a bill does not cancel the export obligation on your GST or DGFT records. Exporters confuse write-off with cancellation and face notices later, so you may still need to report the write-off separately to avoid a mismatch notice.
Does write-off affect my CIBIL or export credit limit?
A write-off under the RBI procedure does not by itself create a CIBIL entry, because it is a regulatory closure of a foreign receivable and is distinct from a domestic loan default. However, if you drew packing credit or post-shipment credit against the bill, the bank may treat the non-realisation as a stressed asset, which can affect your future export credit limits. Confirm with your AD bank.
Can I write off a partially realised export bill?
What happens if the buyer pays after I have written off the bill?
Is write-off available for services exports or only goods?
