The document discusses the role of exchange houses and money transfer operators like Western Union in facilitating foreign inward remittances to India. Exchange houses maintain pre-funded accounts with banks in recipient countries which allow near instant transfer of funds to beneficiaries. Major money transfer operators have a global network of agents and partner with banks and institutions in India to provide remittance services through cash pickup and bank deposits. Regulations governing these channels and processes for domestic and international funds movement are also outlined.

1. Welcom
eRakesh Khare
Asst. General Manager (Retired)
Union Bank of India
M.Sc.,M.B.A.(HR), JAIIB
Specialisation:
Credit, Credit Monitoring, Recovery,
Alternate Delivery Channels, KYC-AML
Contact No.: +919993170274
Email ID: khare_rakesh1@rediffmail.com;
Khare.rakesh1@gmail.com
Exchange HouseMonday, December 28, 2015 1

2. ROLE OF EXCHANGE HOUSES IN FOREIGN
INWARD REMITTANCE
ROLE OF AGENCIES SUCH AS WESTERN UNION
MONEY
TRANSFER/MONEYGRAM ETC. IN FOREIGN
INWARD
REMITTANCE IN INDIA
CARDS AS THE NEW METHOD OF FOREIGN
CURRENCY CARRIERS
Rakesh Khare
Ex-AGM,
M.Sc.,M.B.A.(HR), JAIIB
Union Bank of India
Monday, December 28, 2015

3. Foreign Remittance
 What is Foreign Remittance & Types? How
does Foreign Remittance takes place?
 Methods of Foreign Remittance?
 Regulatory Requirements?
Exchange HouseMonday, December 28, 2015 3

4. Exchange Houses
What are Exchange Houses?
 How is Exchange House differing from Money Changers,
Authorised Dealers, Foreign Banks etc?
 Setting up of Exchange Houses and related Governing Bodies
/ Central Banks Role in this direction.
 What is the Role of Exchange Houses in Foreign Inward
Remittance?
 Salient Features of Exchange House Channel
Exchange HouseMonday, December 28, 2015 4

5. Exchange Houses
 The Companies engaged in the business of money exchange and remittances are
known as Exchange Houses. Exchange Houses are extensively used for
remittances from UAE.
 Exchange Houses are established primarily to meet the foreign exchange and
remittance needs of their trading partners and customers at a time when formal
Banking was yet to be established in the country.
 Exchange Houses are also engaged in currency Exchange Activities. One can Buy
and sell foreign currency conveniently at any of the branches of the Exchange
House.
 Exchange Houses are simply units established overseas in different countries
such as UAE, USA, Europe etc where exchange of currencies between different
countries takes place. They have host of products to transfer money worldwide.
 The Exchange Houses were set up to remit the money at speed of seconds
 Exchange house are the agencies of large business houses or units of Banks to
set up Branches overseas.
 Exchange houses offer reliable, professional and innovative services to make
business transactions more efficient and family remittances faster and easier.
 Most of the Banks have made Rupee Drawing arrangements with Exchange
Houses situated abroad mostly in UAE, Abudhabi. for effecting Inward
Remittances from NRI’s.I.
Exchange HouseMonday, December 28, 2015 5

6. Exchange HouseMonday, December 28, 2015 6

7. Authorised Dealers, Money
Changers
 Authorised Dealers in Foreign Exchange Category-I (AD-I) –
 RBI has granted licences to full fledged banks which are
equipped to undertake foreign exchange transactions in
India. RBI has also granted authorisations to certain financial
institutions to undertake specific type of foreign exchange
transactions incidental to their main business.
 Authorised Money Changers -
 In order to provide facilities for exchange of currencies,
especially to foreign tourist on arrival in India, RBI has
granted permission to several established firms, hotels and
other organisations permitting them to deal in foreign
currency notes, coins & Traveller cheques, subject to
directions issued from time to time. These firms &
organisations are known as Authorised Money Changers.
Exchange HouseMonday, December 28, 2015 7

8. Authorised Dealers, Money
Changers
 Authorised Money Changers fall in two categories
viz:
 Full Fledged Money Changers :- are authorised to
undertake both Purchase and sell transactions with the
Public. They are also known as Authorised Dealer
Category–II (AD-II)-eg Thomas Cook etc.
 Restricted Money Changers:- are authorised only to
purchase foreign Currency Notes, Coins and Traveller
Cheques subject to the condition that all such
collections are surrendered to Authorised Dealers in
Foreign Exchange or Full Fledged Money Changers
Exchange HouseMonday, December 28, 2015 8

9. Exchange Houses
Exchange HouseMonday, December 28, 2015 9

10. Exchange Houses and related Governing
Bodies / Central Banks Role
 Inward Remittances - Regulatory Requirement:
 Inward Remittances are governed by Money
Transfer Service Scheme(MTSS) of RBI.
 Governed by FEMA(Foreign Exchange
Management Act)-1999 Rules
 Governed by FCRA-2010 Rules.
 Setting up of Authorised Dealers, Money Changers
etc. is governed by RBI as mentioned above.
Exchange HouseMonday, December 28, 2015 10

11. Exchange Houses and related Governing
Bodies / Central Banks Role
FERG – Foreign Exchange &
Remittance Group – the companies engaged
in the business of money exchange and remittances
have joined together to form FERG. This move was
initiated by the Central Bank of UAE to bring the various
exchange cos. From large sized companies to single
branch outlets to come on a common platform and
work for mutual benefit. FERG is registered with Dubai
Chamber of Commerce & Industry. The Goals &
Objective of FERG is to become a strong & united Group
to voice the views & opinions of their members and
create awareness about the role of exchange companies
in transferring millions of dollars across the world
through official channels in safe, secure and economical
way within the regulatory frame work of the Central
Bank and Government of UAE. FERG’s role is to ensure
implementation of best practice standards among the
exchange houses in the UAE.
Exchange Cos. are the preferred choice for money
exchange and remittances needs of the customers and
they are having Tie-ups with various correspondent
banks and agents across the world.
Licensed Foreign Exchange & Remittance
Companies in the UAE – End 2013
Emirates Head Office Branches Total
Abu Dhabi 30 181 211
Dubai 85 367 452
Sharjah 11 121 132
Ajman 2 27 29
Umm Al Quwain 0 6 6
Ras Al Khaimah 0 22 22
Fujairah 1 22 23
Al Ain City 5 40 45
Total 134 786 920
* Source: Central Bank of the UAE’s Annual Report 2013
Exchange HouseMonday, December 28, 2015 11

12. Role of Exchange Houses in Foreign
Inward Remittance
 Exchange houses offer a wide range of services from Demand
drafts to instant credit facilities. They facilitate easy access for
customers by delivering products
 Exchange Houses are extensively used for remittances from
UAE. Unlike the Banking Channel this channel is based on
Vostro accounts i.e. accounts maintained by Exchange houses
with various banks in beneficiary countries. These accounts
are pre-funded by Exchange Houses.
 The Remittance Transaction Process includes the following
steps:
Cash
Exchange
House
Modes
1. Email
2. End-to-end
System
Integration
3. Bank’s
Proprietary
Plaform
4. DD drawn on
Vostro
Vostro Account
Beneficiary
Account
Exchange HouseMonday, December 28, 2015 12

13. Role of Exchange Houses in Foreign
Inward Remittance
Remitter deposits remittance money in cash in overseas currency at the Exchange House Counter.
Exchange rate and transaction fee is communicated and confirmed over the exchange counter.
Beneficiary Account Details are provided by the Remitter.
The Exchange house Instructs the Beneficiary Bank with whom it has a Tie-Up for transferring the
Requisite amount in the Beneficiary Country’s local currency using one of the following Modes:
E-Mail: Email is sent by Exchange House to Beneficiary Bank instructing it to transfer the
amount to Furnished Beneficiary account.
Integration of Exchange House and Beneficiary Bank Systems through use of Technology
and Payment Gates.
Beneficiary Bank’s Proprietary Remittance Platform.
By issuing DD drawn on Vostro Account.
Since the Vostro accounts are pre-funded, the beneficiary account is paid based on the funding in this
account. Hence, on receiving the Exchange House’s instruction, the beneficiary receives the amount almost
instantaneously.
The Exchange house has to fund its account with the Beneficiary Bank; hence the latter enjoys the float.
The Exchange House can draw a DD on its Vostro account in favour of the Beneficiary and hand it over to the
remitter over the counter, which can then be dispatched by courier or even sent along with a friend travelling
back home. Alternatively the DD can also be drawn in favour of the remitter, who can then carry it back to his
home country on his return and get it cleared there. This is a secure option for blue collar workers who would
otherwise have to travel hard cash.
Exchange HouseMonday, December 28, 2015 13

14. Role of Agencies such as Western Union Money
Transfer/MoneyGram etc. in Foreign Inward
Remittance in India
 Money Transfer Service Scheme (MTSS) of RBI is a quick and easy way of transferring personal remittances from
abroad to beneficiaries in India. Only inward personal remittances into India such as remittances towards family
maintenance and remittances favouring foreign tourists visiting India are permissible. No outward remittance
from India is permissible under MTSS. The system envisages a tie-up between reputed money transfer
companies abroad known as Overseas Principals and agents in India known as Indian Agents who would disburse
funds to beneficiaries in India at on-going exchange rates. The Indian Agent is not allowed to remit any amount
to the Overseas Principal. Under MTSS the remitters and the beneficiaries are individuals only.
 The Indian agent who has to be an Authorised Dealer, Full Fledged Money Changer or registered Non-Banking
Financial Company (NBFC), IATA approved Travel agents ( having minimum net worth of Rs.25 lakhs ) requires
RBI approval to enter into such an arrangement. The agent is allowed to open a special rupee account with an
AD through which all the remittances disbursed under the scheme, are to be routed. The Indian agent pays the
beneficiaries first, on instructions from the overseas principal and is reimbursed the amount and his commission,
by the overseas principal, within a day or two through normal banking channels.
 Selection of Both the Indian Agent and Overseas Principal are Governed by strict RBI Rules . Indian Agents
entering into arrangements with Money Transfer Operators overseas, known as Overseas Principals, may note
that Overseas Principals with adequate volume of business, track record and outreach will only be considered
under the scheme. Further, since the primary objective of permitting the business of money transfer business in
the country is to facilitate cheaper and more efficient means of receipt of remittances, operators with limited
outreach in terms of branch network in the country and localized operations overseas will not be entertained.
 Non-Banking players play a vital role in the remittance and have a larger share in the Global Remittance business
than conventional banks. MTOs (Money Transfer Operators) like Western Union and Money Gram have a
network of agents across the Globe and serve as Non-Bank Remittance Channels. The remitter can visit an MTO
outlet and remit cash in foreign currency to send money to any part of the globe where the MTO’s agent is
present. The receiver can visit the MTO agent at his location and collect the money in local currency.
Exchange HouseMonday, December 28, 2015 14

15. Role of Agencies such as Western Union Money
Transfer/MoneyGram etc. in Foreign Inward
Remittance in India
Process for an I nternational Remittance transaction is
effected through an MTO is as follow s:
Send Money (Process for Remitter) Receive Money (Process for
Beneficiary)
Find an MTO Agent
Carry an ID card to the
Agent location
Furnish the Request Form
and tender foreign
Currency cash
A Reference No. Is issued
to the Remitter
Contact Beneficiary and
give him the Reference
Number
Find the Nearest MTO
Agent
Collect the Money in Local
Currency
Provide reference number
and ID proof to the Agent
CBI Lecture 1
The settlement between the MTOs in the two
countries takes place through their partner banks. On
receiving the remittance amount in cash from the
remitter, MTOs deposit those funds in their local bank
accounts. MTOs request their bank to transfer the
consolidated amount to the bank account of the MTO
agent in the receiving country. In order to minimize
costs, only the net amount (total amount to be sent
to the recipient country minus total amount to be
received from that country) is sent.Please note that
the beneficiary receives the money much before the
settlement between the MTOs
Fund Movement for an MTO takes place as under:
Recipients Across Globe
MTO in
Remitting
Company
Remitting
Country
Local
Bank
Correspondent Bank
Correspondent Bank
Correspondent Bank
Disbursing Agents
Disbursing Agents
Disbursing Agents
Correspondent Bank Disbursing Agents
Exchange HouseMonday, December 28, 2015 15

16. Money Transfer Operators (MTO’s)
Western Union Money
Money Gram
Xpress Money
Xoom
Instant Cash
EZREMIT
Trans Fast
Global Money Exchange Co. LLC.
Coinstar
& many others..
Channel Partners in India Include Banks, Govt. &
Private Institutions
Banking partners Government
Institutions Public Institution
Andhra Bank
Canara Bank
Central Bank of India
Dena Bank
Indian Bank
Indian Overseas Bank
Karnataka Bank
Oriental Bank of
Commerce
Punjab National Bank
State Bank of India
State Bank of Patiala
Syndicate Bank
UCO Bank, Uniom Bank,
United Bank of India ...
and many others
India Post
BPCL
HPCL
E-seva
KSFE
... and many others
Paul Merchants Ltd.
Transcorp International
Reliance Money Express
Weizmann Forex
Wallstreet Finance Ltd.
Muthoot Finance
... and many others
Exchange HouseMonday, December 28, 2015 16

17. Agencies(MTO’s) for Foreign Inland
Remittance
 Western Union’s product portfolio includes business solutions, consumer-to-consumer money transfer, bill-payment
services and stored-value options such as prepaid cards.
 With a network of more than 500,000 Western Union, Orlandi Valuta and Vigo Agent locations in more than 200
countries and territories, they have locations in the neighbourhoods where our customers live and work. Their
services include:
 Send and receive money
 Bill payments
 Business Solutions
 Prepaid, phone and gift cards and money orders
 MoneyGram is a person to person money transfer service launched by M/s. MoneyGram International Ltd., Colorado,
USA. The Money Gram brand is recognized throughout the world as a leading global payment services company.
 Global Funds Transfer
 MoneyGram Money Transfer global money transfer service allows consumers to send and receive money
worldwide, primarily through a global network of third-party agents that use our money transfer systems. In
addition to person-to-person (also known as cash-to-cash), customers have alternatives in money transfer
delivery channels such as direct-to-account, ATMs and kiosks for deposit and cash receive, cash-to-a mobile
phone and cash-to-card.
 MoneyGram Bill Payments Services their bill payment services allow consumers to make urgent payments or pay
routine bills through their network to certain creditors (“billers”). They maintain relationships with billers in key
industries which include the credit card, mortgage, auto finance, telecommunications, corrections, satellite,
prepaid card and collections industries. Bill payment services also enable consumers to load and reload prepaid
debit cards.
Exchange HouseMonday, December 28, 2015 17

18. Agencies(MTO’s) for Foreign Inland
Remittance ……Contd.
 Xoom: Xoom is an online international money transfer service. They offer a secure, fast,
and inexpensive way to send money from their website to friends and family in the
countries where they have arrangements:
 Recipients do not need a bank account or Internet connection to receive funds. Senders
can fund their money transfer with a credit card, debit card or bank account.
 Xoom partners with select money transfer partners to provide a convenient, secure,
and cost-effective means of sending money to family and friends abroad.
 Xoom moves money fast, and keeps security of Transactions a top priority.
 With Xoom you can have funds withdrawn directly from your U.S. bank account to fund
the money transfer, or pay using major credit cards. Recipients will be able to pick up
the money in cash, have the money directly deposited into their bank account, or
delivered to their door. Options vary by country.
 Xpress Money is in the business of money transfers. Over the last 13 years, they are
providing a money transfer service that is convenient, affordable, accessible and secure.
 Xpress Money is made to be simple, fast and safe. They have state-of-the-art systems
that send transactions around the world in just a few minutes. Their security checks and
seamless, error-free support ensures that every transaction reaches its destination
 The modus operandi of Xpress Money is given in next slide
Exchange HouseMonday, December 28, 2015 18

19. Modus Operandi Xpress Money
 SENDER VISITS XPRESS MONEY AGENT LOCATION.
SUBMITS VALID ID CARD AND THE RECEIVER’S
DETAILS.
 HANDS OVER THE AMOUNT TO BE SENT AND THE
TRANSFER FEE.
 SENDER RECEIVES 16-DIGIT XPIN NUMBER.
 SENDER COMMUNICATES THE 16-DIGIT XPIN NUMBER
TO THE RECEIVER
 SENDER GETS INSTANT SMS NOTIFICATION UPON
COLLECTION OF CASH BY RECEIVER.
 RECEIVES CASH
 SUBMITS VALID ID CARD AND XPIN NUMBER..
 RECEIVER VISITS THE XPRESS MONEYAGENT
LOCATION.
Exchange HouseMonday, December 28, 2015 19

20. International Money Transfer
• Salient features of the International Money Transfer
Service:
 Money Transfer Service Scheme is a quick and easy way
of transferring personal remittances from abroad to
beneficiaries in India. Only inward personal remittances
into India such as remittances towards family
maintenance and remittances favouring foreign tourists
visiting India are permissible. No outward remittance
from India is permissible under MTSS.
 As a result of the collaboration of the Department of
Posts, Government of India with the Western Union
Financial Services and MoneyGram International, a state
of the art International Money transfer Service is now
available through the Post Offices in India, which
enables instantaneous remittance of money from
around 195 countries and territories to India. The
recipients can in fact collect the money in minutes after
the sender has made the remittance.
 The service is targeted to particularly fulfill the needs of
NRI dependent families in India, visiting International
tourists and foreign students studying in India.
• The International Money Transfer process is as
follows:-
o Remitter goes to any one of the Western Union /
MoneyGram Locations in the countries in which the
Service operates
o Fills up a form to send the amount and pays
principal amount and charges.
o The sender gets a unique Money Transfer Control
Number / Reference Number on a receipt after the
transaction is sent through the system.
o Thereafter, the sender calls up his/her payee and
gives information on the money sent.
o The Payee / Receiver goes to the Post Office & fills
up a form to receive money,
o Shows valid identification and receives money along
with the receipt, once the transaction is verified.
o This entire process is completed within ten minutes.
o The Payee receives the full amount in Indian
Rupees.
Exchange HouseMonday, December 28, 2015 20

21. Cards as the new method of Foreign
Currency Carriers
Exchange HouseMonday, December 28, 2015 21

22. Types of Cards
Exchange HouseMonday, December 28, 2015 22

23. Live Case Study
• Rohit
– First day at Madrid
– Mistakes made
– Successes achieved
– The moral of the story
Exchange HouseMonday, December 28, 2015 23

24. Discussion
• What we can learn
from Rohit’s Story
• Best practices
– Large no.of Forex Cards available
with different features.
• Take-aways
– Use Forex prepaid Card on visit
abroad.
– Use Gift Card & other Prepaid
Cards for Domestic Transactions.
Exchange HouseMonday, December 28, 2015 24

25. VISA /MASTERCARD/ AMEX / RuPay NETWORK
VISACARD/MASTERCARD/AMEXCARDS
MerchantMerchant
IssuerIssuer
Typical Card Transaction
AcquirerAcquirer
ConsumerConsumer
Exchange HouseMonday, December 28, 2015 25

26. Exchange HouseMonday, December 28, 2015 26

27. Exchange House
State Bank Prepaid Card
Monday, December 28, 2015 27

28. ICICI Bank Travel Card
Exchange HouseMonday, December 28, 2015 28

29. Citi Bank Travel Card
Exchange House
 Citibank World Money Prepaid Card
 Load your Foreign exchange on India's first prepaid foreign currency denominated travel Card and shop at
millions of Visa merchant outlets, withdraw cash from Visa ATMs or transact online. This forex prepaid Card
offers you the convenience and acceptance of a debit/credit Card along with unmatched safety features to keep
your forex protected while you enjoy your trip abroad.
 As the exchange rates get locked on the date of loading the Card with funds, you also safeguard yourself from
any risks arising from exchange rate fluctuations.
 You can choose to load the card with any of the currencies offered (US Dollars, Pounds Sterling, Euros,
Australian Dollars, and Singapore Dollars) and use the Card in any country where VISA network is present. With
Citibank World Prepaid Card you can shop at any of the VISA Merchants Establishments. Besides this you can
also withdraw cash from over 1.6 Million VISA ATMs (that display the VISA logo), 24-hours a day in over 200
countries.
 Your Citibank World Money Prepaid Card is valid for three years and can be re-loaded with additional funds
within hours making it convenient for those who wish to undertake multiple international trips.
 Citibank World Money Prepaid Card is accepted at millions of merchant establishments around the world
 You don't have to carry any loose change, since you shop for the exact amount on your prepaid card
 The card gives you 24-hours access to cash at over 1.6 million Visa ATMs around the world
 Prepaid card replacement within 96 hours
 Enhanced security on card through 4-digit ATM PIN to authorise all ATM transactions
 Unlimited transactions possible subject to sufficient balance maintained in the card and merchants/ATM not
fixing a floor on transaction size
 Balance on the card delivered to your doorstep upon placing a request for a refund draft
 Detailed statement to track your expenses and card usage
Monday, December 28, 2015 29

30. Thomas Cook's Prepaid Forex
Cards
Exchange HouseMonday, December 28, 2015 30

31. The Retail Foreign Exchange Sale Limits
Exchange House
Purpose Limit Documentation
Basic Travel Quota (BTQ) - For Holidays,
Personal visits etc
USD $10,000.00 per financial
year
Application Form, Form A2 and Self Declaration
Business Travel USD $25,000.00 per Trip Application Form with authorization from the Company, Form A2,
Letter from the Company stating that the employee is going abroad
on business with details of places of stay
Immigration - For people who settle abroad
in countries like Canada, New Zealand etc.
USD $100,000.00 per year Application Form, Form A2 and Self Declaration
Employment Abroad - For a person who is
going to work abroad
USD $100,000.00 per year Application Form, Form A2 and Self Declaration
Medical Treatment - For people who are
travelling abroad for treatment
USD $100,000.00 per year Application Form, Form A2 and Self Declaration
Studies Abroad - For students pursuing
studies abroad
USD $100,000.00 per academic
year
Application Form, Form A2 and Self Declaration
Maintenance of close relatives abroad USD $100,000.00 per year Application Form, Form A2 and Self Declaration
Investments overseas in shares(listed
companies), Gifts & Donations etc (under
liberalised remittance sche me only)
USD 75000/- per financial year Application form, Declaration for purchase of foreign exchange under
the liberalized remittancescheme of USD 75000 and Form A2 (Only
for Individual residents a/c holders)
Monday, December 28, 2015 31

32. Cards as the new method of Foreign Currency Carriers –
Advantage over Cash Currency / Travellers Cheque.
Exchange House
Foreign Currency Notes Prepaid Foreign Currency Cards
If you are travelling to different
countries you have to carry
different currency notes of those
countries
Various currencies can be loaded onto a single card and it
can be used to pay for products and services or to
access cash through ATMs
Accepted worldwide but authenticity of
currency notes can be a problem
Safe, secure and accepted at over million Mastercard
/VISA/AMEX Merchant Establishments worldwide
besides Millions of ATMs
You need to carry loose currency which
can be torn, lost and can also be
cumbersome
You don't have to carry any loose change since you can
shop For the exact amount without enchasing
entire amount on card
Lost cash is lost forever Free Emergency Cash and Free Card Replacement means
you never lose access to your money even if you
lose your card
No security for cash Chip and Pin Security means your money is safer
Purchase and transaction possible only
for the amount in the pocket
Unlimited transactions possible (subject to the balance)
You can reload your card and hence if you are a
student and need money, your loved ones in India
can reload it. As a business traveller for your
regular travel you can just reload the card and
enjoy the convenience of a card while you travelMonday, December 28, 2015 32

33. Advantage of Prepaid Forex Cards
Exchange House
Wide acceptability - both Visa and Mastercard options available
Protects you against common problems when you travel and accidents
Peace of mind through a back-up
Top up while you travel
Smart way to carry multiple currencies. Save time and money
Manage your currencies yourself with NetBanking
Emergency card replacement or cash delivery at overseas location
No danger of forgetting your PIN when overseas. Choose your own PIN
No need to worry as Currency Exchange Rate Fluctuations are taken care
of.
Monday, December 28, 2015 33

34. Summary
• Role of Agencies such as Western Union Money
Transfer/Money Gram etc. in Foreign Inward Remittance in
India
The Western Union Money Transfer / Money Gram /Insta Cash /
Trans-Fast / Coin Star / Global Money & Ez-Remit etc. play the
role of Money Transfer Operator (MTO) as Overseas Principal &
India Post, Muthoot etc play the role of Indian Agent under the
MTSS Scheme of RBI.
• Cards as the New Method of Foreign Currency
Cards are an easy tool to carry Foreign Currency while on tour
abroad either for Enjoying Vacations or Business/Profession or on
Education Trip. Tension Free Travel.
Exchange HouseMonday, December 28, 2015 34

35. Resources
• http://www.rbi.org.in/scripts/FAQView.aspx?
Id=66
• http://rbi.org.in/Scripts/FAQView.aspx?Id=54
• http://www.rbi.org.in/scripts/BS_ViewMasCi
rculardetails.aspx?id=8093
• Website @ SBI, ICICI, CBI, Thomas COOK,
FERG,VISA, MasterCard, AMEX,Citibank,
IndiaPost, Western Union, Moneygram etc.
Exchange HouseMonday, December 28, 2015 35

36. QUESTIONS?
Exchange HouseMonday, December 28, 2015 36

37. http://rakeshkhareblogs.blogspot.in/
FOR MORE DETAILS
PLEASE FOLLOW
MY BLOG SITE ON:
Exchange HouseMonday, December 28, 2015 37

38. Foreign Remittances
 Foreign Remittances are transfer of funds involving exchange of
one currency into another. Foreign remittance can be defined as
‘the purchase and sale of freely convertible foreign currencies as
admissible under Exchange Control Regulations of the country’.
Remittance is the act of transmitting money to a distant location to
fulfil an obligation. Foreign Remittances are of two types:
 Foreign Outward Remittance : When the sender uses a bank or
foreign exchange company to send money to foreign country it
is known as Foreign Outward Remittance.
 Foreign Inward Remittance: Similarly when the funds send by a
person into his parent country where he resides such
remittances are known as Foreign Inward Remittance.
Exchange HouseMonday, December 28, 2015 38

39. Foreign Remittances - Methods
 Foreign Remittances are transfer of funds involving exchange of one currency
into another
 Remittance can be
 Inward – By way of Wire Transfer, Cheques, DDs coming from Migrant
Workers, NRIs, PIOs
 Outward – By way of Wire Transfer, DDs for Personal / Business
Remittances by residents,
 In respect of IWR, India retains the top position for over a decade now.
 Remittances contribute to economic growth and to the livelihood of the needy
people
Exchange HouseMonday, December 28, 2015 39

40. Foreign Remittances- Regulatory
Requirement
 Generally no restrictions on inward Remittance. except that it
should be received through authorized banking channel
(Exception - FCRA 2010)
 NRIs Can send Remittances to their / resident a/cs – No limit
 Bringing Forex during personal visits – Declaration (CDF):
 For foreign currency exceeding USD 5,000/- and FC/FCTC
exceeding USD 10,000/- during visit to India CDF (currency
decl. Form) to be produced.
 Residents receiving For currency / TCs as gift / services
rendered can retain upto USD 2,000/- (overall) to surrender
over and above the limit to AD within a period of 180 days
 Residents can also park these funds in RFC(D) a/c
Exchange HouseMonday, December 28, 2015 40

41. Foreign Remittances- Regulatory
Requirement - Provisions of FCRA 2010
 No foreign contribution shall be accepted by any candidate for election, correspondent,
columnist, cartoonist, editor, owner, printer or publisher of a registered news paper,
judges, govt. servants, members of any legislature, office bearers of political parties .
 Organizations of political nature, not being a political party, require prior permission of
Central Govt.
 Contributions from Indian citizens abroad (NRIs) will not be treated as Foreign Source and
do not attract provisions of FCRA
 Contributions by non-resident foreign citizens of Indian, or non Indian, origin do attract
provisions of FCRA even though the money comes from their NRO / NRE / FCNR accounts
in India
 Credit to registered account with Central Govt.only
 All associations engaged in welfare activities in economic, educational, religious, social,
charitable fields receiving Foreign Contributions have to get themselves registered with
Ministry of Home Affairs
 Application in Form FC-8 giving details of bank and account number
 Home Ministry grants registration and marks a copy to bank
 Unregistered association to take prior permission from Home Ministry before accepting
foreign contribution (Application in Form FC-1A). Copy of permission marked to bank.
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42. Foreign Remittances- Regulatory
Requirement - Provisions of FCRA 2010
 Not more than one account for receiving foreign contribution
 Banks to furnish Half Yearly Returns ( March and September)
furnishing details of Foreign Contribution credited to
registered accounts.
 All branches to submit the said statement in prescribed format
before 30th
April / 31st
October to IBD, CO, Mumbai, and
confirm this to their ROs.
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43. Exchange Houses
Prithvi Exchange a division of Prithvi Softech Limited is licensed by Reserve Bank of
India (RBI) as an Authorized Dealer Category II. Prithvi Exchange offers a whole gamut
of Foreign Exchange services like Money Changing, Money Transfer Services.
They are called by different names say - Money Changers, Authorized Dealers,
Forex Changers, Forex Dealers etc. Have Branches in prominent Cities and
Tourists Centers like Chennai, Bangalore, Hyderabad, Goa and Mahabalipuram.
Prithvi Exchange also serves its customers by selling global Sim cards,
International Sim cards and International Travel Insurance. As a Traveller’s Best
Friend, they provide foreign exchange, Travel insurance, International Sim cards
and all services under single roof.
Money Transfer division provides services to customers through three
channels- Western Union, Money Gram, and Xpress Money, through which
customers can receive money from abroad.
Prithvi Exchange is a Business Partner of American Express Traveller Cheques,
Axis Travel Currency Cards, HDFC Forex Plus Cards, Western Union Money
Transfer.
•Other Examples are given in the annexed sheet.
Exchange HouseMonday, December 28, 2015 43