RBI Updates EDF and IDPMS Rules for Service Transactions

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Dated: 13.11.2026

RBI Updates EDF and IDPMS Rules for Service Transactions

The RBI’s Second Amendment Regulations streamline reporting for smaller service transactions and create distinct treatment for resident individuals, effective 1 October 2026.

The Foreign Exchange Management (Export and Import of Goods and Services) (Second Amendment) Regulations, 2026 were notified on 2 November 2026 under FEMA. They amend the principal 2026 regulations governing export and import of goods and services, with particular relevance for service exporters, service importers and Authorised Dealer (AD) banks.

Key changes at a glance

The amendment introduces three practical changes:

It formally defines a “resident individual.”
It treats specified payment information given to an AD bank as a deemed submission of the Export Declaration Form (EDF) for service exports.
It narrows the circumstances in which AD banks must record service-import details in the Import Data Processing and Monitoring System (IDPMS).

Together, these changes reduce formal reporting friction for resident individuals and lower-value service transactions, while retaining more structured monitoring for larger transactions involving non-individuals.

1. New definition of “resident individual”

The regulations now define a resident individual as a person resident in India who is a natural person.

This definition is important because the amendment applies separate reporting treatment to resident individuals and to other exporters or importers, such as companies, firms, LLPs, trusts or other non-natural persons.

2. Simplified EDF treatment for export of services

The amendment adds two deemed-submission provisions for the EDF in relation to service exports.

Resident individuals: no value threshold

Where a service exporter is a resident individual, the exporter will be treated as having submitted the EDF when they provide the information required for receiving payment for the service to their AD bank for credit to their account.

Notably, this deemed-submission treatment is not linked to a monetary ceiling. The relevant condition is that the individual provides the required remittance information to the AD bank for account credit.

Example: A freelance consultant resident in India receives payment from an overseas client. Once the consultant provides the required information to their AD bank so that the payment can be credited, the EDF is deemed to have been submitted under the amended rule.

Other exporters: available for service payments up to ₹10 lakh

For exporters other than resident individuals, the same deemed-submission approach applies only where the inward remittance for the service does not exceed ₹10 lakh, or its equivalent in foreign currency.

This offers a simplified route for lower-value service receipts by businesses and other non-individual entities. However, transactions above the ₹10 lakh threshold do not receive this specific deemed-EDF treatment under the new provision.

Example: If an Indian company receives an inward remittance of ₹8 lakh for a service export and furnishes the required payment information to its AD bank, it is deemed to have submitted the EDF. If the remittance is ₹12 lakh, the company falls outside this specific threshold-based relaxation.

3. Revised IDPMS reporting requirement for service imports

The amendment also changes the obligation of AD banks to enter service-import information in IDPMS.

An AD bank must record the details within five working days of receiving them, but only when both of the following conditions are met:

the importer is a person other than a resident individual; and
the invoice value or contract value is more than ₹10 lakh, or its foreign-currency equivalent.

The revised language shifts the basis from documents submitted by the importer to details furnished by the importer. More importantly, it excludes resident individuals and service-import transactions of ₹10 lakh or less from this particular IDPMS entry requirement.

Example: An Indian company importing software implementation services under a contract valued at ₹15 lakh must furnish the relevant information, and its AD bank must enter the details in IDPMS within five working days. A resident individual importing services, or a non-individual importing services worth ₹10 lakh or less, is outside this stated IDPMS reporting trigger.

Operational impact

For resident individuals

Resident individuals exporting services benefit from a clearer and more streamlined route: providing the required payment information to the AD bank is treated as EDF submission. They are also excluded from the amended IDPMS service-import reporting condition.

For businesses and other non-individual entities

Non-individual service exporters receive simplified deemed-EDF treatment for inward remittances up to ₹10 lakh. For service imports, IDPMS reporting becomes relevant only where the invoice or contract exceeds ₹10 lakh.

For Authorised Dealer banks

AD banks will need to distinguish between resident individuals and other persons, assess the applicable ₹10 lakh threshold, and ensure IDPMS entries are made within five working days where the revised conditions are met. Their internal processes should also capture the payment information that supports deemed EDF submission for eligible service exports.

Effective date and regulatory context

Although notified on 2 November 2026, the Second Amendment Regulations state that they came into force on 1 October 2026. They amend the Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, originally notified on 13 January 2026. The central policy direction is clear: reporting is being calibrated according to the identity of the transacting party and transaction value. Resident individuals and lower-value service transactions receive simpler treatment, while higher-value service activity by non-individuals remains subject to more formal monitoring requirements.

In case you face any issues related to Indirect Tax-Customs, GST, Foreign Trade Policy (FTP), Arbitration matters and Central Licensing and related advisory matters in India then please feel free to get in touch with SJ EXIM Services.

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Source: RBI

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