How will India’s new automated currency exchange rate module help traders?
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India is upgrading its currency trade operations with the launch of the Exchange Rate Automation Module (ERAM), a digital platform designed to streamline the process of publishing exchange rates, reported state news agency WAM.
Starting from July 4, India’s Central Board of Indirect Taxes and Customs (CBIC) said it will replace the manual system of notifying currency exchange rates with the automated module, making currency conversion more efficient and transparent for traders.
Currently, the Indian Rupee is fully convertible only in the “current” account. That means the domestic currency can be converted into foreign currency and vice versa only for trade in goods and invisibles such as services, transfers or income from investment.
With the launch of ERAM, exchange rates will be available on the Indian Customs gateway website—known as ICEGATE—twice a month.
Benefits of ERAM for traders:
- Enhanced accessibility: ERAM will publish exchange rates for 22 major currencies online in advance, ensuring that importers and exporters can easily access this information. This feature provides businesses with the certainty needed to plan and execute international transactions effectively.
- Updates: Exchange rates will be updated twice a month, specifically on the evenings of the 1st and 3rd Thursdays. These rates will come into effect from midnight the following day, allowing traders to stay abreast of the latest currency valuations without delays.
- Ease of use: By replacing the outdated manual process, ERAM simplifies the procedure of obtaining exchange rates. Traders can find these rates on the Indian Customs gateway website, ICEGATE, and a link will also be available on the CBIC website for easy navigation.
- Consistency and reliability: The automated system ensures consistency in how exchange rates are calculated and published, reducing discrepancies and enhancing trust among traders. This move aligns with India’s broader efforts to digitalise and modernise its customs processes.
- Historical data access: ERAM will maintain a database of historical exchange rates accessible through ICEGATE. This feature allows traders to review past rates and make informed decisions based on historical currency performance.
- Support for multiple currencies: The platform covers a wide range of currencies including the US Dollar, Euro, British Pound, Japanese Yen, and Chinese Yuan, among others. This extensive coverage supports the diverse trading needs of Indian businesses engaging in global commerce.
Currencies impacted by ERAM
The ERAM platform will provide exchange rates for 22 currencies.
In its official notification, CBIC said, “ERAM is a significant step towards trade facilitation as the exchange rates of 22 currencies against the Indian rupee would now be published online in advance for ease of use by all importers and exporters,” it said.
- Australian Dollar
- Bahraini Dinar
- Canadian Dollar
- Chinese Yuan
- Danish Kroner
- Euro
- Hong Kong Dollar
- Japanese Yen
- Korean Won
- Kuwaiti Dinar
- New Zealand Dollar
- Norwegian Kroner
- Pound Sterling
- Qatari Riyal
- Saudi Arabian Riyal
- Singapore Dollar
- South African Rand
- Swedish Kroner
- Swiss Franc
- Turkish Lira
- UAE Dirham
- US Dollar
The launch of the Exchange Rate Automation Module is a significant leap towards enhancing trade facilitation in India.
By providing a reliable and easily accessible source of exchange rate information, ERAM will empower traders to make more informed decisions, thereby boosting efficiency and competitiveness in international markets.
This initiative is part of the CBIC’s ongoing efforts to advance digitalisation in India’s customs processes, reflecting a commitment to supporting the needs of modern commerce.
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