NEW DELHI (TIP): The Reserve Bank of India has decided to continue the enhanced all in cost ceiling for external commercial borrowing or ECBs and trade credits.

The all-in-cost ceiling includes arranger fee, upfront fee, management fee, handling/ processing charges, out of pocket and legal expenses, if any. It may be recalled that the all-in-cost ceiling for ECBs with average maturity of three and up to five years was enhanced to 6 months Libor + 350 bps (one bps is 0.01%) with effect from November 23, 2011 after the crisis in the global markets folowingthe problems in the Euro area, which made it difficult for Indian companies to raise funds abroad. For loans with a maturity of over five years, this ceiling was enhanced to 6 months libor plus 500bps. Allin- cost ceiling for trade credit was enhanced to 6 months Libor + 350 bps.