EEFC/RFC Accounts: Joint Holder with Close Relative Allowed
Current · Source: Reserve Bank of India · RBI/2011-12/176 · issued 15 Sep 2011 · ~2 min read
Quick answerRBI now permits resident individuals to add a resident close relative as a joint holder in EEFC and RFC accounts on a 'former or survivor' basis. The joint holder cannot operate the account during the account holder's lifetime.
The rule, in the simplest words
You can now add a close relative (like your spouse, child, or parent) as a joint holder in your EEFC (foreign currency savings account) or RFC (foreign currency retirement account).
The joint holder can only get the money after you die ('former or survivor' basis) — they cannot use the account or take money out while you are alive.
The close relative must be a resident of India (living in India) and must be a 'close relative' as defined by the Companies Act, 1956 (which includes family members like spouse, children, parents, siblings).
Banks must update their forms and systems to allow this new joint holder option, but they must also make sure the joint holder has no operating rights during your lifetime.
How it plays out — a real example
A forex & trade-finance officer in Indore, Priya, is helping a customer, Mr. Sharma, who has an EEFC account from his export business. Mr. Sharma wants to add his wife as a joint holder so she can inherit the account easily if he passes away. Priya explains that his wife can be added on 'former or survivor' basis, but she cannot withdraw money or operate the account while Mr. Sharma is alive. Priya updates the bank's form to include the new joint holder option and ensures the system blocks any operation by the wife during Mr. Sharma's lifetime.
What changed
Previously, EEFC and RFC accounts could only be held by the resident individual alone. Now, a resident close relative (as defined in the Companies Act, 1956) can be added as a joint holder on a 'former or survivor' basis, but without operating rights during the account holder's life.
What it means for you
Banks must update their account opening procedures to allow adding a close relative as a joint holder in EEFC/RFC accounts. This change simplifies succession planning for customers but requires careful handling of operating restrictions. AD banks need to ensure compliance with the 'former or survivor' basis and non-operation clause.
What you must do
Update internal systems and forms to permit adding a resident close relative as joint holder in EEFC/RFC accounts.
Ensure the joint holder is a 'close relative' as per the Companies Act, 1956 definition.
Implement the 'former or survivor' basis and restrict the joint holder from operating the account during the account holder's lifetime.
Communicate the new facility to existing and prospective EEFC/RFC account holders.
Who it affects
Authorised Dealer (AD) banks handling EEFC/RFC accounts, Resident individuals holding or opening EEFC/RFC accounts, Resident close relatives of such account holders
❓ Common questions
Can the joint relative operate the EEFC/RFC account while the account holder is alive?
No, the circular explicitly states that the resident close relative joint holder shall not be eligible to operate the account during the lifetime of the resident account holder.
What is the definition of 'close relative' for this purpose?
The circular refers to the definition in Section 6 of the Companies Act, 1956. Banks should verify that the joint holder qualifies under that definition.
Does this circular apply to both EEFC and RFC accounts?
Yes, the liberalisation applies to both Exchange Earners Foreign Currency (EEFC) accounts and Resident Foreign Currency (RFC) accounts.
📜 Read the original circular — full text as issued by RBI
RBI/2011-12/176
A.P. (DIR Series) Circular No. 15
September 15, 2011
To
All Banks Authorised to Deal in Foreign Exchange
Madam / Sir,
Exchange Earners Foreign Currency (EEFC) Account and Resident Foreign
Currency (RFC) account – Joint holder - liberalisation
Attention of the Authorised Dealer (AD) banks is invited to the Regulation 4 and 5 of the Notification No. FEMA 10/2000-RB dated May 3, 2000 viz. Foreign Exchange Management (Foreign Currency Accounts by a person resident in India) Regulations, 2000 in terms of which resident individuals are permitted to open EEFC and RFC account, respectively.
2.The Committee to Review the Facilities for Individuals under the Foreign Exchange Management Act, 1999 has in its Report recommended that RFC / EEFC accounts may be permitted to be held jointly with a resident close relative, as defined in Section 6 of the Companies Act, 1956.
3. On a review, it has been decided that resident individuals may be permitted to include resident close relative(s) as defined in the Companies Act, 1956 as a joint holder(s) in their EEFC/RFC bank accounts on ‘former or survivor’ basis. However, such resident Indian close relative, now being made eligible to become joint account holder, shall not be eligible to operate the account during the life time of the resident account holder.
4. The necessary amendments to the Foreign Exchange Management (Foreign Currency Accounts by a person resident in India) Regulations, 2000 are being issued separately.
5. AD banks may bring the contents of this circular to the notice of their account holders concerned.
6. The directions contained in this circular have been issued under Sections 10(4) and 11(1) of the Foreign Exchange Management Act, 1999 (42 of 1999) and are without prejudice to permissions/approvals, if any, required under any other law.
Yours faithfully,
(Meena Hemchandra)
Chief General Manager In-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2011-12/176 · issued 15 Sep 2011. The plain-English explanation above is BankPulse’s own independent summary.
Update internal systems and forms to permit adding a resident close relative as joint holder in EEFC/RFC accounts.
📜 Compliance
Ensure the joint holder is a 'close relative' as per the Companies Act, 1956 definition.
Implement the 'former or survivor' basis and restrict the joint holder from operating the account during the account holder's lifetime.
Communicate the new facility to existing and prospective EEFC/RFC account holders.
Grouped from the action items above — a single circular may involve more than one team.
Worked example & action-note template
Example: if you are an IT/Systems lead at a bank this circular applies to (Authorised Dealer (AD) banks handling EEFC/RFC accounts, Resident individuals holding or opening EEFC/RFC accounts, Resident close relatives of such account holders), your first concrete step on “EEFC/RFC Accounts: Joint Holder with Close Relative Allowed” is: “Update internal systems and forms to permit adding a resident close relative as joint holder in EEFC/RFC accounts.” (RBI issued this 15 Sep 2011).
Circular: RBI/2011-12/176 -- EEFC/RFC Accounts: Joint Holder with Close Relative Allowed
Issued: 15 Sep 2011
Action required: Update internal systems and forms to permit adding a resident close relative as joint holder in EEFC/RFC accounts.
Action required: Ensure the joint holder is a 'close relative' as per the Companies Act, 1956 definition.
Action required: Implement the 'former or survivor' basis and restrict the joint holder from operating the account during the account holder's lifetime.
Action required: Communicate the new facility to existing and prospective EEFC/RFC account holders.
Owner: ____________ Target date: ____________
Board/committee approval needed? Y / N
Evidence filed in compliance register on: ____________
Built only from this circular’s own published fields — not legal advice; always confirm against the official RBI source.
💬 Banker Discussion
Discuss this circular with fellow bankers — reply, upvote what helps, report what doesn’t belong. Be professional; no client data. Views are the commenter’s own, not BankPulse’s.
BankPulse Compliance Evidence Pack — generated 03 Aug 2026 · status cross-checked against RBI’s official withdrawal register (refreshed weekly). Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=6708&Mode=0 — Plain-English summary by BankPulse (bankpulse.ai), reviewed by our expert reviewer, CA Amit Jain. Independent platform, not affiliated with the Reserve Bank of India; is our own plain-English paraphrase, not RBI’s original wording.
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