RBI direction on release of foreign exchange for miscellaneous remittances

RBI on Wednesday(July 3, 2024) today advised all authorised dealers that the earlier circular A.P.(DIR Series) Circular No. 16 dated September 12, 2002, A.P.(DIR Series) Circular No. 55 dated December 23, 2003 and A. P. (DIR Series) Circular No.118 dated May 07, 2012, has since been withdrawn with immediate effect and Authorised Dealers shall obtain Form A2 in physical or digital form for all cross-border remittances irrespective of the value of transaction. This is ” With a view on streamlining the regulatory compliances and operational procedures” said RBI.

In terms of the withdrawn circulars the A.P.(DIR Series) Circular No. 16 dated September 12, 2002, A.P.(DIR Series) Circular No. 55 dated December 23, 2003, and A. P. (DIR Series) Circular No.118 dated May 07, 2012, Authorised Dealers are permitted to release foreign exchange for any current account transaction, based on a simple letter containing basic information and subject to an upper limit of USD 25,000 or its equivalent. It was also advised that Authorised Dealers need not obtain any other documents, including Form A2, and that the payment was to be made by the applicant through Demand Draft or a cheque drawn on his / her bank account.

“Authorised Dealers shall continue to take necessary steps, in terms of Section 10(5) of Foreign Exchange Management Act, 1999, to assure themselves that such transactions do not involve any contravention of the provisions of FEMA,” the notification said.