Are you beginning your journey as an exporter? Then have you got your bank AD code registered? No? It is a must to get this code registered for the smooth transition of business overseas. Here is how all your questions for getting the AD code will be resolved.
What Is A Bank Ad Code?
This code is a 14-digit code number given by the bank where the exporter can create his/her current account for the export business transactions. This code is encrypted with a bank letterhead code, that can be received by the exporter after he has registered on the Import Export Code (IEC) provided by the Director General Of Foreign Trade (DGFT). This code is valid for a lifetime without demanding any renewals.
Why Is It Compulsory to Get a Bank Ad Code?
Foreign Exchange Transactions
The AD code is an identification number provided by the authorized bank dealer to the exporter. This code is necessary for proceeding with foreign exchange transactions like receipt of export proceeds, payment realization for international customers, and any other related transactions.
This bank AD code is of superior significance for the regulatory framework which is set by the central bank(Reserve Bank of India) to regulate and keep an eye on foreign exchange transactions. These transactions for foreign exchange are conducted according to the prevailing rules, guidelines, regulations, and customs.
Monitoring and Reporting
The AD codes allow all the authorities to monitor and track the foreign exchange flow linked with every other trade transaction. This is to ensure optimum fund flow without any misuse or illegal financial transactions. This monitoring and reporting process becomes convenient with getting this code.
Exporters have to preserve their bank AD code for the conduction of several legal documents. The exports can be related through several documents like invoices, custom declarations, shipping bills, etc. These codes help with linking the transactions to the exporter’s respective AD codes.
Receipt of Export Proceeds
The AD code is used for receiving payments from the export destination for exporting goods or services. Here, the exporters have to provide the AD code to the foreign buyer, who uses the code to transfer the payment to the exporter’s designated bank account.
The bank AD code is a mandate in custom declarations to verify the legitimacy of the transaction and the exporter’s identity. This ensures that the goods and services exported are according to the exporting guidelines and regulations. Moreover, it also opens doors for the manufacturer to availing incentives and benefits.
AD code assists with the management of exchange control systems and mechanisms. The export agencies use bank AD codes to help the central bank monitor the foreign exchange flow and guarantee managing currency stability.
Trade Data Analysis
AD bank codes contribute to a great extent to accurate trade statistics. This data is of great emphasis for economic analysis and policy formulation to assess the country’s trade performance.
Compliance with Export Incentives
Exporters can avail of many export incentives like export promotion schemes, duty drawbacks, and other perks by getting bank AD codes. These incentives help for extreme utilization of the AD code and make sure that the exporters can avail of these benefits as and when these are applicable.
Avoiding Penalties and Delays
Faulty transactional information can lead to delays in transactions, penalties, and even several other compliance-related issues. However, this problem is gradually eliminated with the bank AD codes, assisting in secured and smooth transaction flow. Using the correct code can help to streamline this process with safer transactions.
How can You Get Your Bank Ad Code?
Here is how you can get your bank AD code done and dusted.
Choose an Authorised Dealer (AD) Bank
Firstly, choose an authorized dealer bank like the ICEGATE website to register yourself. You can choose any other bank or website that is also an authorized dealer.
Register online to get the ID and password that you will use throughout.
Tap on The Ad Code Button
Then you can tap on the Export Promotion Bank Account Management page where you have to tap on the AD code registration.
Select the Dealer Code and Location
Next, you must select the authorized dealer code registration and tap on submit to access the dashboard of bank AD code and account registration. You can also add the locations later if not done earlier. For this, tap on the add account option on the dashboard’s bottom.
Next, you have to fill in all the details as asked, like the beneficiary name, location, bank name, AD code, etc. With this, you must update the latest documents as prescribed on the website.
After you have successfully initiated the steps for uploading, you will find the Image Reference Number (IRN) and Document Reference Number.
One Time Password
Once the user enters all the necessary inputs, tap on the Save Changes option. On this, you will get a one-time password by mail or the registered mobile number.
The Final Update
Once you submit the OTP, the bank account request will be immediately transferred to ICEGATE. When ICEGATE approves the request, you will get the bank AD code, and the bank account details will begin updating immediately on the Authorised Dealer or AD dashboard.
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