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What is a Proforma Invoice? How to Use It: A Comprehensive Guide for Indian Exporters and Freelancers.

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What is a proforma invoice? How to use it?

Learn what a proforma invoice is, why it's essential for exports, and how Indian businesses can use it to streamline international trade dea

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What is a Proforma Invoice? How to Use It: A Comprehensive Guide for Indian Exporters and Freelancers.

In the fast-evolving world of cross-border business, especially for Indian exporters, freelancers, and startups, clarity and professionalism in transactions are crucial. One of the most important documents in international trade and services is the proforma invoice. If you’re using platforms like Infinity to manage global payments, understanding proforma invoices can help streamline your business, ensure transparency, and build trust with international clients.

What is a Proforma Invoice?

Key Features:

Not a demand for payment: It’s not a payment request or a tax invoice.

Non-binding: It does not have legal standing for accounting or customs purposes.

Details transaction terms: Lists items, quantities, prices, shipping, and payment terms.

Facilitates approvals: Helps buyers arrange for import licenses, foreign exchange, or internal approvals.

Why is a Proforma Invoice Important?

1. Clarity & Transparency

A proforma invoice lays out all the terms of the sale, reducing the risk of misunderstandings between buyer and seller.

2. Facilitates International Trade

Many countries require a proforma invoice to initiate import procedures, open Letters of Credit, or secure foreign currency.

3. Professionalism

Sending a proforma invoice signals to your client that you run a structured, professional business.

4. Smooth Payment Process

Platforms like Infinity allow you to create, manage, and track invoices — including proforma invoices — ensuring a seamless workflow from quotation to payment.

When Should You Use a Proforma Invoice?

Before a Sale is Finalized: When a client requests a quote for goods or services.

For International Shipments: When the buyer needs documentation for import/export clearance.

To Initiate Payment: Some clients require a proforma invoice to process advance payments or open a Letter of Credit.

For Internal Approvals: Large organizations may need a proforma invoice for budgeting or purchase approvals.

What Should a Proforma Invoice Include?

A well-crafted proforma invoice typically contains:

Seller’s and Buyer’s Details: Company name, address, GSTIN (if applicable), contact info.

Invoice Number & Date

Description of Goods/Services: Clear, itemized list with quantities.

Unit Price & Total Price

Currency: Especially important for international transactions (e.g., USD, EUR, GBP).

Delivery Terms: Incoterms (FOB, CIF, etc.), delivery date, shipping method.

Payment Terms: Advance, partial, or after delivery; payment methods.

Validity Period: How long the offer is valid.

Signature/Stamp: For authenticity.

How to Create and Use Proforma Invoices with Infinity

Infinity is designed for Indian businesses, freelancers, and exporters who want to manage international payments and invoicing efficiently. Here’s how you can leverage Infinity for proforma invoices:

1. Effortless Invoice Creation

Infinity’s dashboard allows you to create professional proforma invoices in minutes. You can customize templates, add your branding, and include all necessary transaction details.

2. Multi-Currency Support

With support for 160+ currencies, you can issue proforma invoices in your client’s preferred currency, making it easier for them to process payments and for you to receive funds at competitive FX rates.

3. Seamless Payment Tracking

Once your client accepts the proforma invoice and is ready to pay, Infinity enables you to track payment status in real-time. This transparency helps you plan your deliveries and cash flow.

4. Compliance Made Easy

Infinity ensures all your transactions, including those initiated via proforma invoices, are FIRA-compliant and routed through RBI-authorized banks, making your cross-border business safe and audit-ready.

5. Integrated Workflow

From proforma invoice to payment collection and final commercial invoice, Infinity provides an end-to-end solution — no more juggling spreadsheets or emails.

Step-by-Step: Using a Proforma Invoice on Infinity

Log in to your Infinity account.

Navigate to the Invoicing section.

Select ‘Create Proforma Invoice’.

Fill in client details, item descriptions, pricing, and terms.

Choose the currency and delivery terms.

Preview and send the proforma invoice directly to your client via email or download as PDF.

Track client acceptance and payment status from your Infinity dashboard.

Once payment is received, convert the proforma invoice to a commercial invoice for shipping and compliance.

Best Practices for Proforma Invoices

Be Clear and Detailed: Avoid ambiguity in descriptions and terms.

Set Validity Periods: Prevents confusion about pricing if the deal is delayed.

Use Professional Templates: Enhances your brand image.

Follow Up: After sending, check in with your client to address queries or negotiate terms.

Keep Records: Maintain digital copies for reference and compliance.

Conclusion

A proforma invoice is more than just a quote — it’s a vital tool in international trade and freelance business. With platforms like Infinity, you can create, manage, and track proforma invoices effortlessly, ensuring you get paid faster and with full transparency. Whether you’re a freelancer, exporter, or startup, mastering the use of proforma invoices will help you scale globally, reduce payment friction, and build lasting client relationships.

Ready to streamline your global invoicing and payments? Get started with Infinity today!

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What is a Shipping Bill in Export?

Have you heard of the term "shipping bill" before as an exporter? If you are new to exporting, you might find this term a bit technical, but it is actually one of the most important documents to deal with while starting your export business in India.

Every exporter company, big or small, needs to file a shipping bill before sending out the products from India. It is a document for the custom department to check what goods are going out of the country, how much is it worth of and where is it going. Think of shipping bill as a green signal from the customs when you hear, "The shipment is good to go".

The world of export is filled with documentations, but the shipping bill is something you cannot ignore. Over this blog, we will explore the importance of shipping bill, what it is and why it matters.

What is a shipping bill?

A shipping bill is a document that any exporter must file with the customs clearance department before sending out the shipment from India. It is a kind of declaration of what is being exported out of India, it includes details like:

Nature of the goods

Value and quantity of goods

Exporter details

Consignee details

Mode of transport

Basically, a shipping bill is a custom's permission slip to allow the goods to physically leave India. Shipping bill is generated automatically through ICEGATE and is mandatory for clearing goods at ports or airports.

Once the shipping bill is approved, it acts as a basis for

Custom permission slip (Custom clearance)

Claiming benefits like RoDTEP

Filing for regulations under FEMA

If you are exporting without shipping bill in your hands, it means that you are shipping illegally. It is one of the key documents to prove that the transaction has actually happened.

Importance of the Shipping Bill for Exporters

If you are an exporter in India, then shipping bill is not just a formality to be done, it is actually a ticket for your goods to get out of the country. Custom department needs this document the most, without shipping bill, custom won't let your documents move.

Here is why the shipping bill is the most important document:

Official export declaration: The shipping bill tells the customs each and every detail of the shipment. Who are you sending it to, what's the value and quantity, and what are you sending, all the details are in the shipping bill.

Dependence of custom clearance: For custom department, no shipping bill means no clearance. It is a document that custom officers review before giving the green light for export.

Export incentive: For claiming the export incentives like RoDTEP, MEIS etc., you will be needing shipping bill as a proof.

Export history: For tracking export transactions, the shipping bill acts as a record for export history.

In short, if you are a first time exporter or doing it for a long time, shipping bill is one document you cannot skip.

Different Types of Shipping Bills for Exporters

Different types of exports require different kinds of shipping bills. Not all exports are the same, based on the nature of the shipment and the kind of export you are doing. Here is a list of different types of shipping bills-

Free shipping bill- This types of shipping bill is required when the exporting goods dont qualify for any export incentives.

Dutiable shipping bill- If you are exporting any kind off goods that require export duty, this kind off shipping bill will be required.Custom duty will be calculated based on the duty of the bill.

Drawback shipping bill- If you think you can claim a duty drawback and then this shipping bill is for you. It helps you in getting refund of duties that you have already paid while importing few raw materials of the shipment.

EPS shipping bill- This shipping bill stands for export promotion scheme shipping bill. This is for shipment exported under schemes like EPCG or MEIS.

Exporters can file for these shipping bills electronically through the ICEGATE portal, and based on the export declaration, the correct types of shipping bills are selected.

What are the Key Components of a Shipping Bill?

A shipping bill is one of the most important documents for moving your shipment out of the country. So, before going to fill out the form, it's important to know the key components of a shipping bill. Here is what you will find in a shipping bill:

Exporter Details: This section basically requires your details, like name, IEC code, address, etc.

Consignee Information: Details of who you are sending goods to, like- name, address, country etc.

Nature of consignment: An accurate description of the goods and nature of the consignment, like product name, type and its overall description.

HS code- This code helps the custom to identify the nature of your goods properly. This 8 digit code is crucial for incentive, compliance and duty.

Shipping bill type- As explaid above, different types of shipping bills, this will determine how custom department will treat your shipment.

Mode of transport: This clarifies whether your shipment will move through air, seo or land.

LUT/Bond details: If you are exporting without paying the GST, those details must be included here too.

Documents Required for Filing a Shipping Bill

You will need to arrange a few shipping bills before filling one out. This will help customs to verify your shipment and make sure everything is in order. Here is a list of documents needed:

Commercial invoice: This has the details of the goods being exported- quantity, quality, price, terms of sale, etc.

Packing list- This has details of goods that are packed- like weight, number of boxes, dimensions and what is inside the boxes.

IEC code- This is the importer exporter code, and it's like an ID card for your export business.

Export/Purchase order: This is a proof of order from your overseas buyers.

Declaration: A declaration provided by you that the information given is true and you have all the documents to verify it.

LUT or Bond documents: If you are exporting without GST under LUT then you need to submit the document for the same.

Once you have gathered all these documents, you are ready to file for shipping bill on the ICEGATE portal. The documents and details must be accurate, any mismatch might lead to rejection from the custom department.

What is the difference between a shipping bill and a bill of lading?

Read more: What is a bill of lading? And where is it used?

Conclusion

Getting your shipping bill right is one of the most important steps in your exporting business. It is not just a regular document, it is important as it gets the green signal form the custom department of India to send your shipment abroad. Whether you are new to export or scaling up your export business, getting the right shipping bill will save you from the delays, penalities and missed opportunities.

At Infinity, we understanfd the importance of compliance related paperwork, especially when you alone have to deal with a number of documents and other paper work. That is why we help Indian exporters to not just receive international payments but also help you with export process from end to end.

Sign up today!

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Learn what a shipping bill is, why it's crucial for exporters, its types, documents needed, and how Infinity helps simplify your export jour