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(i) The trade credit must be initially contracted for a period not less than 15 months and must not be in the nature of short-term roll overs.
(ii) Banks cannot issue Letters of Credit/Guarantees / Letter of Undertaking (LOU)/Letter of Comfort (LPC) in favour of the overseas supplier/bank /financial institution for the period beyond three years. The all-in-cost ceiling of the trade credit, with maturity period upto five years will be 350 basis points over six months, LIBOR for the respective currency of credit or applicable benchmark. The all-in-cost ceiling will include arranger fee, upfront fee, management fee, handling/processing charges, out of pocket and legal expenses, if any.
