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Corporate Laws Central Ministry of Finance Foreign Exchange Management Act, 1999

RBI issues Foreign Exchange Management (Guarantees) Regulations, 2026

06-Jan-2026 | F. No. FEMA 8(R)/2026-RB

RBI has issued Foreign Exchange Management (Guarantees) Regulations, 2026, effective from 10th January 2026.

Key Highlights:
1. Any person resident in India (PRI) shall not be a principal debtor (PD), surety or a creditor to a guarantee if other party is a person resident outside India (PROI).
2. Any PRI can act as a surety or principal debtor on the fulfilment of conditions:
a. the underlying transaction for which the guarantee is being given is not prohibited in the FEMA, 1999
b. the surety and the principal debtor are eligible to lend to and borrow from each other.
3. PRI being a creditor may obtain a guarantee with a condition that principal debtor and surety both are PROI.
4. Guarantees must be reported by surety where he is a PRI or PD arranged a guarantee and surety is PROI or creditor where surety and PD are PROI.
5. Reporting shall be done as per the format specified in Annex given in the document.
6. A PRI not meeting reporting requirements can do reporting with Late Submission Fee.

Kindly refer to the attached document for more information.

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