How to Get Paid Faster on Open-Account Exports
To get paid faster on open-account exports, an exporter can tighten invoice and document discipline, set sensible credit terms per buyer, insure or limit buyer risk, and, where cash is needed before the due date, sell the invoice to a finance provider through export factoring. None of these changes the legal deadline: under the RBI's export regulations the proceeds still have to be realised within the permitted period.
Key facts
- On open account you ship first and the buyer pays later, so the exporter funds the buyer's credit period.
- The RBI's export regulations require realisation and repatriation of export proceeds within nine months from the date of shipment (goods) or from the date of invoice (services), with a twelve-month period for rupee-invoiced or rupee-settled exports. That is a legal ceiling, not a recommended payment term.
- An Authorised Dealer bank can extend the period on the exporter's request if it is satisfied with the reasons.
- An advance can be made against an approved invoice, subject to credit approval and the facility terms.
What are the main ways to be paid for an export?
| Method | Who carries the risk | Effect on your cash flow |
|---|---|---|
| Cash in advance | The buyer | Fastest for you, hardest to sell |
| Letter of credit | A bank's commitment, subject to compliant documents | Assurance of payment, but paperwork and the LC's own payment date |
| Documentary collection | Mostly the exporter | Banks handle documents but do not guarantee payment |
| Open account | The exporter | You wait for the buyer's due date |
Open account is the most competitive term to offer and the hardest on working capital, which is why it drives the search for ways to shorten the wait. For a comparison of the first two against factoring see export factoring vs letter of credit.
What can an exporter do before invoicing?
- Choose terms per buyer. A first-time buyer, a repeat buyer and a buyer in a higher-risk market do not need the same payment term.
- Check the buyer. Use credit reports and trade references, and keep the file. A finance provider will ask the same questions. See buyer credit limits explained.
- Put the terms in writing. The contract or purchase order should state the amount, currency, due date, and what counts as acceptance of the goods.
- Decide on credit protection. An export credit insurance policy, or non-recourse treatment from a finance provider on an eligible buyer, can reduce credit risk. See export credit insurance vs factoring.
What can an exporter do after shipping?
- Send clean, complete documents quickly. Late or incomplete documents are the commonest reason payment slips. See documents needed for export factoring.
- Get the buyer's acceptance of the goods in writing where practicable. It protects against a later dispute.
- Chase before the due date, not after. Put reminders on the calendar for each invoice.
- Track the deadline. Know when the realisation period for each shipment ends. See export realisation timelines under FEMA.
Where does export factoring fit?
Export factoring is for the case where the invoice is issued, the buyer is approved and you would rather have most of the money now than at the due date. The finance provider advances cash against the invoice, collects from the buyer at maturity and pays you the balance, less charges. It does not remove the need for good documentation or for a genuine underlying sale. Read the full process in export factoring in India.
What should you not expect from any financing?
No financing product removes the exporter's obligations. A genuine dispute over the goods will still delay payment, an advance is subject to credit approval, and nothing here is a guarantee of timing or of approval.
Frequently asked questions
What is open-account trade?
Open account is a trade term where the exporter ships goods or delivers services and the buyer pays after a credit period, without a letter of credit.
How long do I have to receive export payment under FEMA?
Under the RBI's Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, the period is nine months from the date of shipment for goods and from the date of invoice for services. For exports invoiced or settled in rupees it is twelve months. Check the current text with your Authorised Dealer bank.
Can factoring help if my buyer pays late?
It can bring cash forward on an approved invoice, but late payment by the buyer is still governed by the facility terms, including any recourse position.
Does faster payment mean a discount on the invoice?
Not necessarily. Factoring involves charges for the period the advance is outstanding. Ask for the full cost breakdown before you accept an advance.
Sources
- RBI, Foreign Exchange Management (Export and Import of Goods and Services) Regulations, 2026, Regulation 5: rbi.org.in.
- RBI, amendment to Regulation 5 dated 22 September 2026: rbi.org.in.
Selling on open account and want to be paid sooner? Tell us about your buyers and invoices.
Check eligibility → Takes 60 seconds · no obligationGeneral information for exporters, not legal, tax or financial advice. Regulations change: check the current text with your Authorised Dealer bank or adviser. Any advance is set after credit review and under the facility terms.