What changed
Previously, payments for foreign exchange exceeding Rs. 50,000 could only be made via crossed cheques, banker's cheques, pay orders, or demand drafts. Now, RBI has added debit cards, credit cards, and prepaid cards as acceptable payment modes for any amount, provided the cardholder is the same as the purchaser and KYC/AML norms are followed.
What it means for you
Banks and money changers can now offer more flexible payment options to travellers, reducing reliance on cash and cheques. This simplifies transactions for customers and aligns with digital payment trends, but requires strict adherence to KYC/AML guidelines and card limit checks.
What you must do
- Update internal systems to accept debit, credit, and prepaid cards for foreign exchange sales.
- Ensure KYC/AML verification is completed for all card-based transactions.
- Verify that the cardholder and the purchaser of foreign currency are the same person.
- Train staff on new payment acceptance procedures and limit checks.
- Communicate the new payment options to customers and constituents.
Who it affects
Authorised Dealers Category I & II, Full Fledged Money Changers (FFMCs), Travellers purchasing foreign exchange for private visits or other purposes
Can I use my credit card to pay for foreign exchange if the amount is above Rs. 50,000?
Yes, RBI now allows payment via credit, debit, or prepaid cards for any amount, as long as the cardholder is the same as the purchaser and KYC/AML norms are followed.
Are there any additional limits on card payments for foreign exchange?
The sale of foreign currency must be within the limits prescribed by the bank for credit or prepaid cards. Debit card limits depend on the card issuer's policies.
Do I still need to provide a crossed cheque if I use a card?
No, card payment is an alternative to cheque or cash. You can choose any acceptable mode, but for amounts over Rs. 50,000, cash is not allowed unless the total is within that limit.