logo
Company Profile
  • icon
  • icon
  • icon
  • icon

What is AD Code?

In India, authorized banks issue a unique 14-digit number to businesses that engage in international trade, known as an AD Code or Authorized Dealer Code. This identifier serves as a link between your bank and your export-import transactions, ensuring that foreign exchange transactions are traceable and in compliance with regulations. This code is indispensable for the processing of payments associated with imports and exports, as well as for customs clearance.


Why is AD Code Important?

The Indian export-import ecosystem is significantly influenced by the AD Code. In order to clear goods through customs, it is essential for all exporters and importers to possess a valid AD Code. Shipments cannot be processed at Indian ports without it. It also assists the Reserve Bank of India (RBI) in the monitoring and regulation of foreign exchange inflows and outflows in accordance with the Foreign Exchange Management Act (FEMA). Furthermore, the acquisition of an AD Code enables the seamless utilization of government export incentives.


  1. For Export Transactions
    • Exporters must quote their AD Code on shipping bills and export documentation.
    • The AD Code allows banks to process export proceeds and ensure that payments in foreign currency are correctly credited to the exporter’s account.

  2. For Import Transactions
    • Importers must quote their AD Code on bills of entry and import documentation.
    • It helps banks track foreign currency payments to overseas suppliers and comply with RBI regulations.

  3. Linkage with IEC
    • Each AD Code is linked to an IEC number, ensuring that all import-export transactions are traceable.
    • This helps authorities monitor trade and prevent illegal transactions.

  4. Compliance with FEMA Regulations
    • Under the Foreign Exchange Management Act (FEMA), 1999, all international trade transactions must be routed through authorized banks.
    • The AD Code ensures compliance with foreign exchange regulations and prevents violations.

  5. Smooth Banking and Forex Processing
    • AD Code enables banks to process foreign currency payments efficiently, whether it is export proceeds or import payments.
    • Without an AD Code, transactions may face delays or rejection by the bank.

  6. Simplifies Trade Documentation
    • It standardizes banking information on shipping bills, invoices, and customs documents, reducing errors and delays during clearance.

Key Topic Index

  • What is AD Code?
  • Why is AD Code Important?
  • Advantages of the AD Code for Importers and Exporters
  • Simplified Step-by-Step AD Code Registration Process
  • Documents Required for AD Code Registration?
  • Frequently Asked Questions
table content image

Advantages of the AD Code for Importers and Exporters


  • Achieving a smooth customs clearance is crucial for the filing of shipping bills and customs documentation.
  • Regulatory compliance makes sure you follow customs and RBI regulations when transacting in foreign currencies.
  • Exporters can access export incentives, such as duty drawbacks, GST refunds, and other government programs.
  • The receipt of export proceeds directly into your bank account is made easy and secure through the use of timely payments.
  • Registering for ICEGATE is necessary in order to electronically submit export and import documents through the government's ICEGATE portal.

Simplified Step-by-Step AD Code Registration Process



  • Step 1: Pick the bank for your authorized dealer
    If the RBI allows foreign exchange transactions at the bank where you have your business current account, you should start there.
  • Step 2: Send in your application and papers
    You can get the AD Code application form at your bank. Fill it out and send it in with the required documents, such as your IEC, PAN, GST certificate, proof of your bank account, and proof of your business registration.

    (Note: Customs may change the formats of AD Codes from time to time). To get the most up-to-date format, get in touch with the MAKE MERCHANT team.

  • Step 3: Verify the bank and give out the AD code
    Once everything checks out, the bank sends you a unique 14-digit AD Code letter.
  • Step 4: Sign up for an AD Code on the ICEGATE Portal
    To file electronically and get through customs, register your AD Code on the ICEGATE government portal.

Documents Required for AD Code Registration

Generally, you need the following documents for AD Code registration:


  • Import Export Code (IEC)
  • PAN Card of the entity or proprietor
  • GST Registration Certificate
  • Bank account details or certificate from the authorized dealer bank
  • Business registration or incorporation certificate
  • Address proof for the business
  • Passport-size photographs of authorized signatories
  • Identity proofs such as Aadhaar, Voter ID, or Passport of owners or directors

(Note: The exact documents may vary depending on your bank’s requirements.)

Frequently Asked Questions

An AD Code is a unique number issued by authorized banks to exporters and importers for facilitating foreign exchange transactions and customs clearance.

Yes, it is compulsory for customs clearance and foreign exchange compliance.

Key documents include IEC, PAN card, GST registration, bank account proof, and business registration certificates.

After obtaining the AD Code letter from your bank, register it on the ICEGATE portal by uploading the letter and relevant documents to enable electronic customs filing.

Typically, it takes a few days to one or two weeks depending on the bank’s processing time.

When you want to launch your business, Make Merchant is where it's at!

AD Code registration is a necessary and required part of doing business in India's import-export sector. Not only does it make customs clearance easier, but it also makes sure you follow RBI rules and lets you take advantage of valuable export incentives. At MAKE MERCHANT, we help businesses with every step of the AD Code registration process to go as smoothly and quickly as possible. This way, you can focus on growing your international trade without worrying about compliance.

Contact

Get free business consultation Today

We Make Merchant your one-stop solutions- Export to import, we are your support.

logo

We are a one-stop solution for businesses that wish to grow and move from local to global

Contact Info

Office Address

Address: 308, 3rd floor, bheema complex, nirman vihar , east delhi, delhi 110092