Foreign Exchange Management Act

RESERVE BANK OF INDIA
EXCHANGE CONTROL DEPARTMENT
CENTRAL OFFICE
MUMBAI 400 001

Date : Sep 27, 2002

Procedure and Documentation Simplified for Release of Foreign Exchange

During last few months, the Reserve Bank of India has taken several steps to simplify the procedures with a view to ensuring that resident individuals are able to obtain foreign exchange with minimum formalities and documentation. With a view to ensuring that authorised dealers are able to provide absolutely hassle free service to resident individuals, the Reserve Bank advised authorised dealers on September 12, 2002, that for release of foreign exchange upto USD 500 to resident individuals, no document need be called for at all. Further, so long as necessary details, namely, name and address of the applicant, name and address of the beneficiary, amount to be remitted and purpose of remittance are indicated, the applicants are not required to even to fill up the prescribed application form viz., Form A-2.

It is reiterated, for the benefit of the public that for the following categories of transactions no documents are required to be produced by bonafide applicants for obtaining necessary foreign exchange:

1. For tourism upto USD 5000, in one calendar year

2. For business travel upto USD 25,000 per trip

3. For studies upto USD 30,000 per academic year

4. For medical treatment upto USD50,000

5. Gift/donations upto USD 5,000 in a year

It is, however, clarified that for remittance or purchase of foreign exchange for all these eligible purposes, the payment is required to be made by a cheque drawn on the applicant’s bank account or by a demand draft.

Further, it is added that international credit cards, ATM cards, debit cards can be used on internet also for any purpose for which exchange can be purchased from an authorised dealer in India. For instances, for meeting travel expenses outside India, for import of books, purchase of downloadable softwares or import of any other item into India which is permissible under the current export-import policy.

The Reserve Bank has once again brought these instructions to the notice of authorised dealers.

Press Release : 2002-03/335