The Foreign Exchange Management (Borrowing and Lending) Regulations, 2018 govern borrowing and lending including External Commercial Borrowings (ECB) by eligible persons and entities. These regulations apply to residents, borrowers, lenders, and authorised dealer banks involved in cross-border borrowing transactions. The present amendment revises definitions, introduces restrictions on end-use of borrowed funds, modifies borrowing conditions from NRI/OCI relatives, and replaces the ECB framework. The regulations were previously amended multiple times, with the last amendment issued in October 2025.

1. Regulation 2 substituted
   Definitions relating to ECB, benchmark rate, cost of borrowing, infrastructure sector, real estate business, related party and other key terms are revised and expanded.
2. Regulation 3A inserted – End-use restrictions
   Borrowed funds shall not be used for chit funds, nidhi company, specified real estate activities, restricted agriculture/plantation, TDR trading, investment in securities (except permitted corporate purposes), repayment of certain domestic INR loans, or prohibited on-lending.
3. Regulation 6(b)(vi) amended
   Resident individuals may borrow in INR from NRI/OCI relatives only through inward remittance or debit to specified NRI accounts, on non-repatriation basis, with repayment and interest credited only to lender’s NRO account.
4. Schedule I substituted – ECB Framework
   Revised provisions on eligible borrowers, recognised lenders, borrowing limits, maturity, cost, security, refinancing, conversion, and reporting through ECB forms under supervision of AD Category-I Bank.