Reserve Bank of India (RBI) overhauls FEMA guarantees regime, widens automatic route and mandates quarterly reporting.

Exam-focused facts from the 14 January 2026 current affairs briefing.

Key facts

Reserve Bank of India (RBI) replaces the 2000 rules with the Foreign Exchange Management (Guarantees) Regulations, 2026.
Guarantees are freely permitted if the underlying transaction is not prohibited under FEMA and parties are eligible to lend or borrow under FEMA borrowing and lending rules.
Guarantees issued, modified or invoked must be reported quarterly within 15 days of quarter-end to authorised dealer banks using Form GRN.
Late submission attracts a fee of Rs 7,500 + 0.025% × amount involved × years of delay (rounded to nearest month and Rs 100).
Exemptions cover guarantees by overseas/IFSC branches of authorised dealer banks, irrevocable payment commitments by custodian banks for FPIs, and guarantees under Overseas Investment Regulations, 2022.