What changed
The earlier restriction that no fresh authorization would be issued to Urban Cooperative Banks (UCBs) as Full-Fledged Money Changers (FFMCs) has been removed. Instead, UCBs meeting eligibility norms can now be considered for Authorised Dealer Category-I or Category-II authorization. Additionally, the facility for reconversion of Indian currency up to Rs 50,000 against ATM receipts for foreign tourists has been extended to Full-Fledged Money Changers (FFMCs), whereas earlier it was limited to Authorised Dealers Category-I and Category-II.
What it means for you
This circular expands the scope for Urban Cooperative Banks by allowing them to apply for higher-tier foreign exchange authorizations, potentially increasing their role in forex markets. For FFMCs, the ability to offer reconversion services against ATM receipts will enhance customer convenience for foreign tourists, aligning them with ADs. Banks and lenders must update their internal guidelines to reflect these changes and ensure compliance with the revised memorandum.
What you must do
- Update internal policies to reflect that UCBs can now apply for AD Category-I or II authorization if they meet eligibility norms.
- Extend reconversion facility against ATM receipts up to Rs 50,000 to foreign tourists through FFMCs, ensuring proper document verification.
- Train staff on the revised guidelines, especially for verifying passport, visa, confirmed departure ticket within 7 days, and original ATM slip.
- Communicate these changes to all concerned branches and authorized persons handling foreign exchange transactions.
Who it affects
Urban Cooperative Banks (UCBs), Full-Fledged Money Changers (FFMCs), Authorised Dealers Category-I and Category-II, Foreign tourists (non-NRIs) using ATM receipts for reconversion
Can Urban Cooperative Banks now get fresh authorization as FFMCs?
No, the earlier note barring fresh FFMC authorization for UCBs has been replaced. Now, UCBs fulfilling eligibility norms can be considered for Authorised Dealer Category-I or Category-II authorization instead.
What documents are needed for reconversion of Indian rupees against ATM receipts?
Foreign tourists must provide a valid passport and visa, a confirmed ticket for departure within 7 days, and the original ATM slip verified with the original debit/credit card. The limit is Rs 50,000 per tourist.
Does this circular affect any other instructions from the 2009 circular?
No, all other instructions in the A.P. (DIR Series) Circular No. 57 dated March 9, 2009, remain unchanged. Only the specified parts (Part A and Part E) have been amended.