TaxTMI 
TaxTMI 
Foreign Exchange Management (Authorised Persons) Regulations, 2026
X X X X Extracts X X X X
X X X X Extracts X X X X
....accordingly, - (a) "Act" means the Foreign Exchange Management Act, 1999 (42 of 1999); (b) "Annual Forex Turnover" means the aggregate of foreign exchange purchased and sold by an authorised person or a Forex Correspondent from/to the public directly, and through its agents/franchisees/Forex Correspondents, during a financial year, excluding the value of inward remittances processed; (c) "Authorised Dealer (AD)" means a person authorised as an authorised dealer under sub-section (1) of section 10 of the Act; (d) "Company" means a company incorporated under the Companies Act, 2013 (18 of 2013); (e) "Control" shall have the same meaning as assigned to it under sub-section (27) of section 2 of the Companies Act, 2013 (18 of 2013); (f) "Director" shall have the same meaning as assigned to it under sub-section (34) of section 2 of the Companies Act, 2013 (18 of 2013); (g) "Forex Correspondent (FxC)" means an agent of an Authorised Dealer appointed in terms of the Forex Correspondent Scheme (FCS) issued by the Reserve Bank; (h) "Full Fledged Money Changer (FFMC)" means a money changer authorised under sub-section (1)....
X X X X Extracts X X X X
X X X X Extracts X X X X
....serve Bank for processing such applications, the same shall be provided within thirty days from the date of coming into force of these regulations; else the applications shall be deemed to have been rejected. Such applications shall be processed as per the eligibility conditions, documents and procedure listed at Annex. 4. Eligibility conditions - (1) An applicant shall be a company incorporated under the Companies Act 2013. (2) The Memorandum of Association (MoA) of the applicant should include the foreign exchange related activity for which the authorisation is being sought. (3) An applicant shall fulfil the following criteria at the time of application: Category of AP Eligible entities AD Category-I A bank licensed by the Reserve Bank. AD Category-II i. A bank licensed by or a Non-Banking Financial Company (NBFC) registered with the Reserve Bank. ii. A Full-Fledged Money Changer or a Forex Correspondent functioning for at least two years with an average annual forex turnover of Rs.50 crore during the previous two financial years. AD Category-III An entity: i. required to deal in foreign exchange incidental to the activities undertaken by it....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ore, in case of an AD Category-II; (d) Rs.2 crore, in case of an AD Category-III: and it is in compliance with provisions of sub regulation (5) and (6) of regulation 4. (2) An application for renewal of existing authorisation shall be made at least two months before expiry of the existing authorisation. In such case, the existing authorisation shall continue till renewal is granted under these regulations or the application is rejected, as the case may be. 6. Consideration of application - (1) The Reserve Bank, while considering an application, shall examine all matters which it deems relevant, including but not limited to the eligibility conditions specified in these regulations, and in case of entities regulated by the Reserve Bank, the inputs of the respective regulatory and supervisory departments of the Reserve Bank. (2) Any application for grant or renewal of authorisation- (a) which is incorrect, false or misleading in nature; or (b) where the applicant is not in compliance with the eligibility requirements as set out under these regulations; or (c) where the applicant or any of its promoter or director or KMPs is not a 'fit an....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... any time vary or revoke any of the existing conditions of authorisation or impose new conditions. (3) An authorised person, other than a bank or an NBFC, shall achieve minimum annual forex turnover as given below, within two years from the date of coming into force of these regulations or from the commencement of forex business, whichever is later, and shall maintain the minimum annual forex turnover thereafter on an ongoing basis: Category of AP Minimum annual forex turnover AD Category-II Rs.50 crores FFMC Rs.10 crores (4) The requirements under these regulations, or as specified by the Reserve Bank from time to time, including minimum net worth, turnover and 'fit and proper' status, shall be fulfilled on an ongoing basis and any deviation shall be immediately brought to the notice of the Reserve Bank. (5) If the net worth of the authorised person falls below the minimum specified in these regulations, the authorised person shall restore the net worth to the required minimum, within a period of six months, or such additional time as the Reserve Bank may grant. Failure to do so may lead to revocation of authorisation. (6) An authorised person, other ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....application or revocation to the Appellate Authority namely, the Executive Director in charge of the Foreign Exchange Department, Central Office, Reserve Bank of India, Mumbai. (2) An appeal under sub-regulation (1) shall be filed within forty-five calendar days from the date of receipt of the letter intimating rejection of application or revocation of authorisation. (3) On receipt of an appeal, the Appellate Authority may, after giving applicant an opportunity of being heard, pass a reasoned order within sixty calendar days from the date of receipt of appeal. Chapter VI - Forex Correspondent Scheme (FCS) 10. Forex Correspondent - (1) An Authorised Dealer Category-I or an Authorised Dealer Category-II may appoint an entity or entities as agent, known as Forex Correspondent (FxC), for conducting money changing business under a 'principal-agent' model. (2) An FxC shall be permitted to deal in foreign exchange with any of its customer or with other entities as per the Forex Correspondent Scheme laid out in this chapter. 11. Permitted Activities - An FxC is permitted to undertake the following activities: (a) Purchase of foreign currency notes/coins and trave....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Direction - Money Changing Activities' as amended from time to time. (2) The franchisee arrangements valid as on the date of coming into force of these regulations shall be discontinued within two years from the date of coming into force of these regulations. Thereafter, the franchisees can be appointed as an FxC, subject to conditions laid down under the FCS. Annex [Please refer to regulation 3(6)] 1. The applicant shall be a company registered under the Companies Act, 1956/ Companies Act 2013/ Registration of Companies (Sikkim) Act, 1961. 2. The minimum Net Owned Funds (NOF) required for consideration as FFMC are as follows: Category Minimum NOF Single branch FFMC Rs.25 lakh Multiple branch FFMC Rs.50 lakh Note: The Net Owned Funds of applicants, other than banks, should be calculated as per the following. (a) Owned Funds: (Paid-up Equity Capital + Free reserves + Credit balance in Profit & Loss A/c) minus (Accumulated balance of loss, Deferred revenue expenditure and Other intangible assets) (b) Net Owned Funds: Owned funds minus the amount of investments in shares of its subsidiaries, companies in the same group, all (other) non-banking....