Memorandum of Procedure for channeling transactions through Asian Clearing Union (ACU)

ACU settlement mechanism: channel ACU denominated cross border payments via AD Category I banks with central bank funding oversight.

Revised procedure requires AD Category I banks to channel eligible current international transactions through ACU using distinct ACU Dollar and ACU Euro accounts, treating such transactions like other foreign exchange business. RBI facilitates funding and repatriation by receiving/delivering US Dollar and Euro to/from AD Category I banks only upon confirmation of corresponding credits to RBI's correspondent accounts; AD Category I banks must remit/deliver amounts on the value date and face penal interest for defaults. All ACU operations remain subject to FEMA regulations and the Memorandum's procedural and documentation requirements.