FX retail: Now Foreign Exchange retail trading platform for retail customers of banks

The Reserve Bank of India, on Thursday (June 20, 2019), communicated that the electronic trading platform for buying/selling foreign exchange (FX-Retail) by retail customers (individuals, MSMEs) of banks is ready for rollout. The FX-Retail platform can be accessed by retail customers of a bank (through the websitehttps://www.fxretail.co.in), who has a need to purchase or sell US dollar against the rupee for delivery on cash basis (same day), tom basis (next day), or spot basis (two days after date of transaction). According to the communication, the customer registration process on the platform shall commence on July 01, 2019 and the platform shall be available for transactions from August 05, 2019. Regarding the operation of the platform, including the process of customer registration, being issued by the Clearing Corporation of India Limited (CCIL) on their website (https://www.ccilindia.com)

Fx retail platform available to users subject to;

1. No cap on the number of transactions per customer during a day. The total amount of transactions of a customer shall be subject to the limit assigned by its bank.
2. The size of a single transaction is not allowed to exceed USD 5 million.
3. No transaction charges shall be levied by the CCIL on transactions of customers if such transactions do not exceed USD 50,000 per day.
4. A transaction charge of 0.0004% shall be charged by the CCIL for transactions in excess of USD 50,000 per day.
5. Banks may charge fees for the service provided by them. Fees charged by banks, if any, shall be indicated on the FX-Retail platform.
6. Banks may recover from customers’ transaction and settlement charges levied by the CCIL.

During 2017, RBI had proposed a foreign exchange trading portal for retail participants with an idea that would provide customers access to an online electronic trading platform on which they can purchase or sell foreign currency at market – clearing prices. FX-Retail platform would therefore promote completion among market makers which would lead to better pricing for all customers regardless of order size. At present buyers of small lots of currency pay 1% to 3% more depending upon from whom they buy it. So price conscious customers may move to online platform from unorganized forex market.