AD Code in India: A Complete Guide for Exporters
When you step into an export business, obtaining an Authorised Dealer (AD) Code becomes non-negotiable. It links your bank account with Indian Customs so your shipments move forward without unnecessary delays. Beyond just the movement of goods, it also plays a crucial role in tracking foreign exchange transactions.
Let’s take a closer look at what an AD Code is, its purpose and how to obtain it.
TL;DR - Summary
- What it is: - A 14-digit numeric identifier provided by RBI-authorised banks.
- Why you need it: - Required for customs clearance and access to foreign trade incentives.
- How to get it: - Submit a formal letter to your bank, then register on ICEGATE.
- Cost: - The bank may charge a one-time fee for issuing the AD Code.
What is an AD Code?
An AD code is a unique 14-digit numeric identifier, which is issued by the RBI-authorised banks to both importers and exporters. Banks that are allowed to deal in foreign exchange can issue an AD code.
A bank AD code assures that the current account is approved to send and receive international business payments legally. The bank issues an AD code letter in a standard format as prescribed by the Directorate General of Foreign Trade (DGFT).
Many assume the AD code is the same as an IFSC or RBI code, but it is actually used specifically for handling foreign business transactions.
Format of the 14-Digit AD Code
XXXX
Bank Code
XXX
Branch Code
XXXXXXX
Unique Serial
4 digits
Bank Code
Issued by RBI to identify the bank
3 digits
Branch Code
Identifies the branch holding the exporter's account
7 digits
Unique Serial
Unique identifier assigned by the bank to the exporter
The 14-digit AD code consists of an alphanumeric format, which is structured below:
- Bank Code: The first 4 characters of the code are the bank code issued by the RBI to the bank.
- Branch Code: the next 3 characters represent the bank’s branch code, which maintains the exporter’s bank account.
- Unique Serial Number: The final 7 alphanumeric characters are a unique identifier, which is issued by the bank to the exporter.
AD Code vs RBI Code
A lot of individuals often consider an AD code as the RBI purpose code. However, the key differences between these codes are:
Why is AD Code Required for Exporters and Importers?
Now that you know what AD code means, you must realise it is not just a procedural requirement. Its importance spans multiple stages of international trade, from customs clearance to receiving export benefits.
Let’s understand its role in detail:
Customs Clearance
When submitting shipping bills to customs officials, an AD code is mandatory. It enables customs officers to confirm the validity of the transaction and guarantee compliance with import and export laws.
Foreign Exchange Compliance
The AD Code helps the RBI keep a close watch on foreign exchange inflows and outflows under the Foreign Exchange Management Act (FEMA) regulations. It reduces the risk of unauthorised or suspicious cross-border transactions.
Export Incentives and Refunds
Exporters need an AD Code to get government incentives such as the Remission of Duties and Taxes on Exported Products (RoDTEP), Duty Drawback and GST refunds. It ensures you do not miss out on these earnings, since these incentives are credited directly to the bank account linked with the code.
Register your AD Code before your first export shipment to avoid any delays in getting incentives from the government.
Who Needs an AD Code?
Not every business requires an AD Code. Let’s understand who actually needs it:
- Service exporters receiving foreign currency payments
- Goods exporters shipping physical goods
- Importers bringing goods to India
- Amazon sellers using the Global Selling program
- Freelancers exporting services (if using AD bank for forex)
What Documents are Required for AD Code Registration?
Hover over each card to see details
Bank Certificate
RequiredWhat to check
Must follow Customs Public Notice No. 93/2020 dated 29 July 2020. Verify the prescribed format before submission.
IEC Certificate
RequiredWhat to check
Stamped and signed copy with the company's seal. Identifies you as an authorised importer or exporter.
Company PAN Card
RequiredWhat to check
Duly stamped and signed copy with seal. Company name must match the bank account exactly.
GST Certificate
RequiredWhat to check
Sealed and signed copy issued by the appropriate authority. Must reflect the same company name as other documents.
Class 3 DSC
OnlineWhat to check
Digital Signature Certificate from a qualified authority. Required to verify legitimacy of online submissions.
Cancelled Cheque
RequiredWhat to check
Issued in the company's name with account details visible. Confirms the bank account linked to the AD Code.
To register for an AD code, submit the following necessary documents:
- Bank Certificate: Collect a bank certificate with Customs Public Notice No. 93/2020 (dated 29 July 2020). Make sure it follows the prescribed format.
- IEC Certificate: Submit a stamped and signed copy of the Import Export Code (IEC) Certificate with the company’s seal. It helps to identify the importers and exporters.
- Company PAN Card: Provide a duly stamped and signed copy of your company’s Permanent Account Number (PAN) Card with its seal and signature.
- GST Certificate: Provide a sealed and signed copy of the GST Certificate issued by the appropriate authority.
- Class 3 DSC: To verify the legitimacy of online submissions, obtain a Class 3 Digital Signature Certificate (DSC) from a qualified authority.
- Cancelled Cheque: Submit a cancelled cheque with account details, issued in the company’s name. This aids in confirming the associated bank account.
Ensure all documents match the company name accurately. Mismatched names between the bank account and the IEC might cause rejection.
How to Get an AD Code from Your Bank?
Hover over each step to expand
Formal letter required — standard format
Typically a few business days
Getting an AD code from your bank is a mandatory first step for ICEGATE registration, which allows you to carry out export transactions and receive foreign remittances.
Here’s how to obtain it:
Step 1. Choose an AD Bank
First, make sure you have a current account with a bank that is permitted to handle foreign exchange transactions. It is best to check with your bank in advance since this authorisation is not available with every bank.
Step 2. Submit an AD Code Request Letter to Your Bank
Write a formal letter to your bank asking for the AD Code. In addition to requesting the issuance of a 14-digit AD code, your letter should explicitly describe your intended purpose and business needs in detail.
Step 3. Collect Required Documents
Keep the required documents handy, including the bank certificate, IEC certificate and company PAN card.
Step 4. Bank Verification and Issuance
Before releasing the AD Code letter on their official letterhead, the bank will confirm all of your information and supporting documentation. Depending on your bank's policies, this process usually takes a few business days.
How to Register AD Code on ICEGATE?
Hover over each step to see details
Visit the ICEGATE portal and follow the steps below to register your AD code to make it functional:
Step 1. ICEGATE Registration
If you do not have a user ID, create one on the ICEGATE portal. You may access a variety of customs-related services through this government portal.
Step 2. Document Upload Using e-Sanchit
Use the e-Sanchit portal to upload your AD Code letter and any accompanying documentation. Make sure every document is formatted correctly and is easy to read.
Step 3. Go to AD Code Registration
Follow these steps in ICEGATE: “Financial Services” → “Bank Account Management” → “AD Code Registration”.
Step 4. Fill Out the Registration Form
Complete all required fields, including your AD code, bank name, branch details, and port information. Double-check all entries for accuracy.
Step 5. Submit and Wait for Approval
After submitting your form, wait for customs clearance. This procedure guarantees that the customs database is successfully linked to your AD code.
What are the AD Code Registration Fees?
Registering the AD Code on ICEGATE is free of cost. However, the bank may charge a fee for issuing the AD Code letter. Apart from this, there are no recurring charges after registration.
How Does AD Code Relate to IEC Code?
Both the AD Code and the IEC Code are crucial regulatory standards for cross-border trade. Let us understand their relationship in the table below:
Once you have your IEC code, obtaining the AD Code is the next step to unlock global business opportunities!
What are the Benefits of Having an AD Code for Your Export Business?
An AD Code helps reduce day-to-day operational load, so the export process can run more smoothly. Here are some of its primary benefits:
- A registered AD Code helps your shipments clear customs faster, cutting down on delays, penalties, storage costs and unnecessary hold-ups.
- Export incentives and refunds are credited straight to your linked bank account with far less paperwork.
- It supports RBI oversight of foreign exchange transactions and ensures your business stays transparent in global dealings.
Simplify International Payments with Skydo
Obtaining AD Code takes care of compliance but getting paid should not feel like another task to manage. This is where Skydo comes in!
Being a cross-border payment aggregator, Skydo can help you receive international payments via your local bank accounts. You can access virtual accounts for your export business in EUR, USD, GBP, and SGD and receive payments seamlessly. Additionally, our platform comes with flat fees and no hidden forex markups.
So what are you waiting for? Get started with Skydo now!
Do I need a separate AD Code for each port?
No, you do not need a separate AD code for every port. If you have been issued a primary AD code by your bank, you should register this single code with customs for every port and conduct trade activities.
How long does AD Code registration take?
Does AD Code expire or need renewal?
What happens if I export without an AD Code?
Can I update my AD Code if I switch banks?
