Compounding of contraventions: framework allowing voluntary settlement subject to eligibility, procedure, and payment requirements.
The Master Direction consolidates RBI's framework for compounding of contraventions under FEMA, 1999 and the Compounding Rules, 2024, setting eligibility and exclusions (including non-compoundable categories such as Section 3(a), repeat contraventions within three years, unquantifiable amounts, and matters involving suspected money laundering or DoE objections). It prescribes filing and jurisdictional rules, application content and fees, required administrative corrective actions, procedures for assessment, factors influencing compounding amounts, a computation matrix with fixed and variable components and ceilings, hearing protocols, payment mechanisms, and publication of compounding orders.

Overseas investment compliance framework sets definitions, approval routes, reporting duties, and AD bank controls for resident investors.
Overseas investment by persons resident in India is regulated under FEMA through the Overseas Investment Rules, Regulations, and Master Direction, covering ODI, OPI, financial commitment, approval routes, reporting, and AD bank procedures. The framework defines key concepts such as foreign entity, Indian entity, control, subsidiary, equity capital, and financial commitment, and sets the conditions for permitted investments, including strategic sectors, startups, IFSC investments, deferred payment, pricing, transfer, restructuring, and immovable property abroad. It also prescribes documentation, UIN allotment, late reporting fees, restrictions, and compliance duties for authorised dealer banks.

Trade Credit Framework clarified: permissible forms, security, hedging and mandatory monthly reporting to ensure FEMA compliance.
Master Direction consolidates RBI directives under FEMA for Trade Credits, specifying eligible forms, recognised lenders, permitted currencies and maturities, hedging expectations and all-in-cost ceilings. It details admissible security (bank/overseas guarantees, charges on movable/immovable/financial assets, corporate/personal guarantees) subject to loan security clauses, no objection certificates and compliance with FEMA/FDI/SEZ norms. AD Category I banks must assign unique IDs to TCs and submit consolidated monthly Form TC returns to RBI, ensure no double financing for SEZ transactions, verify maturity/operating cycle limits, and confirm borrowers' risk management and hedging arrangements.

Foreign investment framework under FEMA sets entry routes, sectoral caps, pricing rules, and transfer conditions for non-resident investors.
Foreign investment in India is regulated under FEMA and the Non-Debt Instruments framework, with the Reserve Bank administering the rules through directions to authorised dealers and related reporting and payment requirements. The direction consolidates the legal meaning of foreign investment, foreign direct investment, foreign portfolio investment, investment vehicles, LLP investment, downstream investment, non-repatriation holdings, pricing, valuation, and transfer mechanics, while making the underlying NDI Rules and other FEMA notifications prevail in case of inconsistency. It also sets out prohibited sectors, Government-route restrictions for specified ownership patterns, and the permitted routes, instruments and transfer mechanisms for non-resident investors.

Money Transfer Service Scheme: authorised Indian Agents must meet fund, due diligence, collateral, KYC/AML and reporting requirements.
The Master Direction prescribes the MTSS regulatory framework: only specified authorised entities meeting minimum Net Owned Funds and fitness criteria may be authorised by the Reserve Bank as Indian Agents for inward personal remittances; applications must include due diligence documents on Overseas Principals, audited financials and banker reports; Overseas Principals must meet net worth and AML requirements and remain responsible for agent activities; Sub Agents require specified due diligence and quarterly reporting; operational limits, KYC/AML/CFT controls, collateral requirements and renewal and inspection procedures are mandated.

Foreign exchange derivative rules set user classification, hedging limits, settlement rules and reporting duties across OTC and exchange-traded markets.
Foreign exchange derivative and inter-bank dealing directions under FEMA establish the framework for authorised persons, authorised dealer banks, standalone primary dealers, recognised stock exchanges and recognised clearing corporations in OTC and exchange traded currency markets. The directions define key concepts, classify users as retail or non-retail, and prescribe product permissions, hedging restrictions, settlement rules, limits on leveraged structures, and conditions for INR-linked and non-INR-linked contracts. They also set open position, gap, borrowing, reporting and trade repository requirements, together with separate rules for asset-liability hedging, gold hedging, capital hedging and inter-bank foreign exchange dealings.

Uniform interest rate framework: co operative banks must follow board approved, disclosed, non negotiable deposit rates with defined premature withdrawal rules.
RBI prescribes a uniform, board approved interest rate framework for co operative banks: rates must be disclosed, non negotiable, uniform across branches and customers, with daily product calculation for savings, tenor and size based variation for term deposits, prescribed premature withdrawal rules and board approved penalty disclosure. Parallel rules govern NRE/NRO and FCNR(B) deposits including authorised bank acceptance, minimum tenors, LIBOR/SWAP linked ceilings for FCNR(B), conversion treatment for returning NRIs, and prohibitions on incentive based deposit mobilisation.

Issue and pricing permissions for private sector bank share issuances require statutory compliance and prescribed pricing methods.
The Directions grant general permission to private sector banks to issue shares by public issues, private placements, rights issues and bonus issues, subject to compliance with FEMA, foreign investment policy, SEBI guidelines and the Companies Act; corporate approvals must be obtained. Pricing must follow SEBI formula for listed banks and Companies Act rules for unlisted banks. Allotments triggering threshold holdings require prior regulatory approval and post-allotment reporting of issue details, allottee names and post-allotment shareholding to the regulator in the prescribed format.

Bank amalgamation rules: RBI requires board and shareholder approvals, independent valuations, and safeguards for capital and dissenting shareholders.
These Directions establish the Reserve Bank's framework for voluntary amalgamation of private sector banks and NBFC bank amalgamations, requiring board approval by a two thirds majority of total board membership, shareholder approval by two thirds in value of votes cast, comprehensive due diligence, independent valuation and fair swap ratios, submission of detailed financials and valuer reports, scrutiny of capital adequacy and shareholding concentration, prior Reserve Bank sanction for NBFC amalgamations before Tribunal submission, and provision for dissenting shareholders to claim value as determined by the Reserve Bank.

Benchmark-based lending: internal MCLR and Base Rate frameworks require banks to price loans by benchmark plus spread.
Banks must adopt a Board approved interest rate policy and price rupee advances (subject to specified exemptions) by reference to an internal or external benchmark plus a bank defined spread. The internal benchmarks are the Base Rate and the Marginal Cost of Funds based Lending Rate (MCLR), the latter comprising marginal cost of funds, negative carry on CRR, operating costs and a tenor premium; MCLR is tenor linked and published at specified maturities, reviewed monthly (or quarterly where permitted), and governs reset mechanics of floating rate loans.

Interest Rate Regulation: banks must follow board approved, uniform, transparent deposit interest policies with benchmark linkage.
These Directions require scheduled commercial banks to adopt board approved, publicly disclosed and uniform interest rate policies for domestic and specified non resident deposit accounts, mandate non negotiability and transparency of rates, prescribe interest calculation conventions (including daily product for savings and benchmark linkage for floating term deposits), set rules for tenor and size based rate differentiation, govern premature withdrawal interest and penalty disclosure, allow limited additional interest schemes for staff and senior citizens, regulate conversion and treatment of non resident deposits on return to India, and prohibit incentive based deposit mobilisation except narrow permitted exceptions.

Know Your Customer rules: mandatory risk based CDD, digital/V CIP onboarding, CKYCR uploads, sanctions screening and FIU reporting.
Know Your Customer (KYC) Direction, 2016 requires Reserve Bank regulated entities to implement Board approved KYC policies comprising Customer Acceptance Policy, Risk Management, Customer Identification Procedures and transaction monitoring; mandates documented ML/TF risk assessments and a Risk Based Approach, prescribes Customer Due Diligence for individuals and legal entities including Aadhaar/PAN/OVDs and beneficial owner identification, sets rules for non face to face onboarding (OTP e KYC and V CIP) with technical and audit standards, requires periodic KYC updation, CKYCR upload of KYC records, reporting to FIU IND, wire transfer traceability, and daily sanctions screening and freezing obligations under UAPA and WMD Act procedures.

FEMA miscellaneous directions clarify resident foreign assets, joint NRI accounts, deposit crystallisation, and regularisation of declared overseas assets.
Foreign exchange directions under FEMA consolidate miscellaneous instructions for authorised dealers and authorised persons, covering tax-compliance treatment for remittances, use and reinvestment of eligible foreign assets, joint resident accounts with NRI close relatives, treatment of medical payments for NRI relatives, routing of funds raised abroad, information-sharing with the Special Investigation Team, crystallisation of inoperative foreign currency deposits, IFSC transactions, and regularisation of declared foreign assets under the Black Money Act.

Reporting under FEMA consolidates reporting forms, timelines, and compliance requirements for foreign exchange transactions and investments.
Reporting under FEMA consolidates the Reserve Bank's prescribed returns, forms and reporting timelines for authorised persons and related entities across foreign exchange transactions. It standardises reporting for money changing, MTSS, Rupee Drawing Arrangements, Liberalised Remittance Scheme, foreign investment, overseas investment, borrowing and lending, trade credit, non-resident foreign accounts, immovable property, guarantees, compounding and late submission fees. The direction is intended to support supervision, timely filing and compliance with changing RBI instructions.

Import of Goods and Services: banks must verify imports, record remittances in IDPMS, and apply conditional guarantees for advances.
The Master Direction requires AD Category - I banks, under FEMA, to ensure bona fide import transactions, perform KYC/AML and due diligence, create Outward Remittance Messages in IDPMS for all remittances lacking evidence, reconcile ORMs with Bills of Entry, preserve and verify import documents, follow timelines for settlement/extension/write-off, and apply conditional guarantee requirements for advance remittances across sectors including diamonds, aircraft, gold and services.

Export Proceeds Realisation governs settlement, reporting, foreign-currency accounts, export advances and authorised dealer obligations for Indian exports.
Exporters must realise and repatriate the full value of goods, software and services through permitted banking channels within the prescribed period. AD Category-I banks must verify transaction bona fides, ensure KYC and anti-money-laundering compliance, process export declarations and report export transactions, advances and realisations through EDPMS. The framework permits INR trade settlement through Special Rupee Vostro Accounts, third-party payments, eligible foreign-currency accounts, export advances, factoring, set-off and specified write-offs, subject to documentation, reporting and applicable conditions.

Overseas direct investment rules: automatic and approval routes define funding, limits, reporting and sectoral safeguards.
This Master Direction consolidates the regulatory framework for resident direct investments in overseas Joint Ventures and Wholly Owned Subsidiaries, distinguishing an Automatic Route with specified funding methods, ceilings and eligibility conditions from an Approval Route requiring prior Reserve Bank consent. It prescribes the composition and treatment of financial commitments, sectoral prohibitions and additional conditions for financial services, reporting obligations including UIN allotment and Annual Performance Reports, valuation and documentation norms for acquisitions and share swaps, rules on guarantees, pledges and creation of charges, and operational duties of Authorised Dealer Category I banks.

Foreign currency and deposit account rules under FEMA set eligibility, permitted credits, debits, repatriation and compliance requirements.
This Master Direction consolidates FEMA rules on foreign currency and deposit accounts for residents and non-residents, including permitted account types, eligible holders, credits, debits, repatriation, and tax compliance. It covers resident accounts such as EEFC, RFC, RFC(D), DDA, project office, SEZ, exporter and startup accounts, as well as overseas foreign currency accounts for studies, visits, employment, investment, and export realisation. It also sets out the framework for NRE, FCNR(B), NRO, SNRR and escrow accounts, together with nomination, designation on change of residence, and authorised dealer compliance.

Remittance of assets under FEMA is regulated through prescribed limits, documentation, and Reserve Bank approval for exceptional cases.
Remittance of assets outside India is governed by FEMA regulations and Reserve Bank directions to authorised dealers. The directions define remittance of assets and related categories, permit specified remittances by foreign nationals, NRIs and PIOs within prescribed limits and conditions, and set out documentary requirements for companies under liquidation and branch or office closures. Prior Reserve Bank approval is required for remittances above the stated limit, in hardship cases, and for other unlisted remittances. All remittances are subject to applicable taxes in India.

Immovable property acquisition rules impose eligibility, permitted payment channels, reporting and conditional repatriation requirements.
Acquisition and transfer of immovable property under FEMA set out who may acquire or transfer property in India and outside India, with NRIs and OCIs permitted to purchase non agricultural immovable property and receive property by gift or inheritance, subject to payment through specified banking channels, account debits, and reporting. Special rules govern joint acquisitions by non resident spouses, long term visa holders, diplomatic missions, and foreign branches; repatriation of sale proceeds is conditional on prior Reserve Bank permission or compliance with specified remittance facilities, and nationals or entities of certain countries require prior RBI approval.