What changed
RBI advised AD Category-I banks to issue ACU Dollar account statements regularly to foreign counterparties, both on a per-transaction basis and monthly. This replaces any earlier informal practices and aligns with international best practices to avoid reconciliation problems.
What it means for you
Banks must now systematically send ACU Dollar statements to foreign counterparties, ensuring timely and regular reporting. This reduces reconciliation errors and enhances operational efficiency in cross-border transactions through the Asian Clearing Union.
What you must do
- Update internal systems to generate ACU Dollar account statements for each transaction and on a monthly basis.
- Ensure statements are sent promptly to foreign counterparties to avoid reconciliation delays.
- Train staff on the new reporting requirements under FEMA sections 10(4) and 11(1).
- Review existing ACU transaction processes to align with this circular.
Who it affects
AD Category-I banks handling ACU transactions, Foreign counterparties of Indian banks in ACU settlements, RBI's Foreign Exchange Department
What is the key requirement of this circular?
AD Category-I banks must issue regular ACU Dollar account statements to foreign counterparties on a per-transaction basis and monthly, to align with international best practices and reduce reconciliation issues.
Under which legal provisions is this circular issued?
It is issued under sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999, and is without prejudice to other permissions or approvals required under any other law.
Does this circular replace any previous guidelines?
It supplements the Memorandum of Procedure for channelling transactions through ACU (April 2003) by adding specific statement issuance requirements.