Let’s take a look at the distinctions between these two ideas, which are the bank realization certificate and the foreign inbound remittance certificate, in this post here on the site. To tell you the truth, consumers who receive cash or trade from other nations are eligible to get any of these certificates, and they receive them from an approved bank.
Now, let’s get to the bottom of this: what exactly is a bank realization certificate?
A bank realization certificate, often known as a BRC, is a document that serves as verification for businesses that deal in international trade. This document is absolutely necessary for a consumer who would like to exchange advantages in accordance with international trade policy. The administration of commerce in India falls under the purview of many government departments, including DGFT, RBI, FEMA, and Customs, amongst others.
Difference between FIRC and BRC
Here’s what you must know about FIRC
BRC is an abbreviation for “Bank Realization Certificate,” which refers to a certificate that a bank issues to a customer in exchange for certain documentation. In most cases, a bank will issue a BRC to a client of theirs who is involved in the export industry, and it will be attached to each shipment of export revenues. Many different export promotion organizations provide exporters financial aid in the form of tax breaks, exemptions from import duties, and other incentives.
In order to qualify for these incentives:
- Exporters are required to provide these authorities with documentation of their exports.
- In addition to the export promotion duplicate of shipping bill (EP copy of shipping bill), Mate Receipt issued by that of the carrier, and/or customs authorized ARE-1 (only for goods subject to central excise) are also necessary
- Another proof of exports is indeed a Bank Realization Certificate BRC issued by the respective bank that received foreign sums for exporters. This certificate must be presented to customs officials.
Therefore, as soon as the exporter has received the amount owed under each shipment, they must go to their bank & present the evidence of exports along with the FIRC information (Foreign Inward Remittance Certificate) in order to acquire a BRC owing under each shipment. It includes:
- A customs legally binding document of EP copy of Shipping Bill
- A Mate receipt issued by the carrier of goods
- A central excise document of ARE – 1 (wherever applicable)
- Bank Realization Certificate (BRC) is filed with the different agencies as proof of shipment or proof of exports. This is done in conjunction with the other documents listed above.
An exporter requires an eBRC in order to take advantage of the many export incentives (duty exemptions, rebates, low-cost loans, and so on) that the government provides as a component of the Foreign Trade Policy. These export incentives include duty exemptions. The Director General of Foreign Trade is responsible for the implementation of the Foreign Trade Policy (FTP) and the majority of the export incentives in India (DGFT).
Previously completed offline, the DGFT has moved the entire procedure online and eliminated the need for paper forms. It makes it possible for financial institutions to upload papers to the DGFT system as well as information pertaining to foreign exchange as well as exports. eBRC is the name of the digital certificate that handles the transmission of this information.
How are they used?
Since It may be used for so many different things, a Foreign Inward Remittance Certificate is regarded as a highly significant piece of evidence documentation. It can be used for the following:
If a certain number of shares have been issued inside the name of a beneficiary as well as the company that has issued the shares is located outside of the country. Here the Foreign Inward Remittance Certificate serves as both evidentiary proofs of something like the money that has been received and then also validates the transaction that has been made.
- In the event that an Indian resident transfers or sells his share to a person who’s now a non-resident Indian or any foreign entity, the Foreign Inward Remittance Certificate serves as testimony in these types of situations.
- The Foreign Inward Remittance Certificate may then be utilized as something that could testify that perhaps the share purchase consideration has already been received by the resident seller case. This is because the Foreign Inward Remittance Certificate is an official document issued by the receiving country. It is an incredibly important document that is given to the Director General of Foreign Trade in situations involving export promotion for capital goods and the need for the advanced license.
Issuance of e-FIRC
When the revenues of trade of goods and services are received by a bank that is not the same bank that the paperwork was filed through, the recipient bank will issue an e-FIRC to link the two banks. In most cases, when the home bank determines that the papers meet its requirements, it will produce an inward remittance (IRM) just on the government export portal (EDPMS). The IRM number is also known as an e-FIRC number.