What is ECB Compliance?

External Commercial Borrowing (ECB) compliance refers to the adherence to regulations set by the Reserve Bank of India (RBI) for Indian companies borrowing from foreign sources. ECBs are a vital source of capital for businesses seeking to expand operations, but they come with specific regulatory requirements. These include guidelines on borrowing limits, eligible lenders, and 'end-use restrictions ', which refer to the specific purposes for which the borrowed funds can be used, and reporting obligations. Understanding and ensuring ECB Compliance is essential for companies to avoid penalties and maintain smooth financial operations. Whether you're a business owner or financial professional, staying informed on ECB compliance is crucial for successful cross-border financing.