What changed
RBI has deleted the requirement for applicants to demonstrate increased outreach and locational advantage when applying for new Full Fledged Money Changer (FFMC) licenses. This change was made to provide more flexibility to authorised persons in choosing branch locations. All other existing instructions from the March 2009 circular remain unchanged.
What it means for you
Banks and other authorised persons can now set up FFMC branches without having to justify how the location improves outreach or offers locational advantage. This reduces the regulatory burden on applicants and speeds up the licensing process. It also allows entities to strategically place branches based on business needs rather than compliance criteria.
What you must do
- Review your FFMC branch expansion plans to take advantage of the relaxed location criteria.
- Ensure all other requirements from the March 2009 circular are still met when applying for new FFMC licenses.
- Update internal compliance checklists to reflect the removal of outreach and locational advantage criteria.
- Communicate this change to your foreign exchange business teams and branch managers.
Who it affects
Authorised Persons in foreign exchange, Banks with FFMC operations, Entities applying for new FFMC licenses
Does this circular change any other FFMC licensing requirements?
No, only the criteria related to outreach and locational advantage have been removed. All other instructions from the March 2009 circular remain unchanged.
When did this circular take effect?
The circular was issued on January 30, 2012, and took effect from that date.