RBI Extends Rupee Drawing Arrangements to FATF-Compliant Countries
Current · Source: Reserve Bank of India · RBI/2012-13/423 · issued 28 Feb 2013 · ~2 min read
Quick answerRBI now allows AD Category-I banks to use Speed Remittance Procedure for inward remittances via Exchange Houses in all FATF-compliant countries, expanding beyond Gulf, Hong Kong, Singapore, and Malaysia.
The rule, in the simplest words
Banks can now use the Speed Remittance Procedure (a fast way to send money) for money coming into India from Exchange Houses (companies that exchange money) in any country that follows FATF rules (global rules to stop money laundering).
Before, this was only allowed for Gulf countries, Hong Kong, Singapore, and Malaysia. Now it's for all FATF-compliant countries.
People from any FATF-compliant country can now use this to pay for medical treatment or hotel stays in India, not just people from the earlier limited list of countries.
Banks must check that the Exchange House's country is really FATF-compliant before they start working with them.
How it plays out — a real example
Rajesh, a forex & trade-finance officer in Indore, gets a request from a bank in Brazil (a FATF-compliant country) to send money to a customer's relative in India for a hospital bill. Before this rule, Rajesh couldn't process it because Brazil wasn't on the old list. Now, he can use the Speed Remittance Procedure to quickly and safely bring the money into India, making the customer happy and expanding his bank's services.
What changed
Previously, Rupee Drawing Arrangements (RDAs) via Exchange Houses were limited to Gulf countries, Hong Kong, Singapore, and Malaysia (Speed Remittance only). Now, RDAs under Speed Remittance Procedure are extended to Exchange Houses in all FATF-compliant jurisdictions. Additionally, items 7 and 8 of the permitted transactions list now allow payments to medical institutions and hotels by nationals of all FATF-compliant countries, not just earlier specified regions.
What it means for you
Banks can now process cross-border inward remittances through Exchange Houses in any FATF-compliant country, broadening the remittance corridor. This reduces operational restrictions and may increase remittance inflows from new geographies. However, banks must ensure due diligence on FATF compliance of the Exchange House's jurisdiction.
What you must do
Update internal policies to include Exchange Houses in all FATF-compliant countries under Speed Remittance Procedure.
Verify FATF compliance status of any new jurisdiction before onboarding Exchange Houses.
Train staff on revised permitted transactions for payments to medical institutions and hotels by nationals of FATF-compliant countries.
Review and amend existing agreements with Exchange Houses to reflect expanded scope.
Who it affects
AD Category-I banks handling Rupee Drawing Arrangements, Exchange Houses in FATF-compliant countries, NRIs and nationals of FATF-compliant countries sending remittances to India
❓ Common questions
Which countries are now eligible for Rupee Drawing Arrangements under this circular?
All countries that are FATF-compliant are now eligible, but only under the Speed Remittance Procedure. Previously, only Gulf countries, Hong Kong, Singapore, and Malaysia were covered.
What specific transactions are now permitted for nationals of FATF-compliant countries?
Payments to medical institutions and hospitals for medical treatment, and payments to hotels for stay, are now permitted for nationals of all FATF-compliant countries, in addition to NRIs.
Does this circular change any other instructions from the 2008 circular?
No, all other instructions from the February 6, 2008 circular remain unchanged. Only items 7 and 8 under Part (B) of Annex-I have been modified as described.
📜 Read the original circular — full text as issued by RBI
RBI/2012-13/423
A. P. (DIR Series) Circular No. 85
February 28, 2013
To,
All Authorised Dealer Category - I Banks
Madam / Sir,
Memorandum of Instructions for Opening and Maintenance of Rupee / Foreign Currency Vostro Accounts of Non-resident Exchange Houses
Attention of Authorised Dealer Category – I (AD Category – I) banks is invited to the A.P. (DIR Series) Circular No. 28 [A. P. (FL/RL Series) Circular No. 02] dated February 6, 2008 on the captioned subject, as amended from time to time.
2. Under the extant Rupee Drawing Arrangements (RDAs), cross-border inward remittances are received in India by AD Category-I banks through Exchange Houses situated in Gulf countries, Hong Kong, Singapore and Malaysia (for Malaysia only under Speed Remittance Procedure). With a view to extending the scope of the said arrangement to certain other jurisdictions, it has been decided to extend the RDAs only under the Speed Remittance Procedure to Exchange Houses situated in all countries which are FATF compliant.
3. Accordingly, items No. 7 and 8 under Part (B) Permitted Transactions of Annex-I to the above mentioned circular have been modified and the said modified items may be read as under:
7. Payments to medical institutions and hospitals in India, for medical treatment of NRIs / their dependents and nationals of all FATF countries.
8. Payments to hotels by nationals of all FATF compliant countries/ NRIs for their stay.
4. All other instructions issued vide A.P. (DIR Series) Circular No. 28 [A. P. (FL/RL Series) Circular No. 02] dated February 6, 2008, as amended from time to time will remain unchanged.
5. AD Category - I banks may bring the contents of this circular to the notice of their constituents concerned.
6. The directions contained in this circular have been issued under Section 10(4) and Section 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,
(Rudra Narayan Kar)
Chief General Manager-In-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2012-13/423 · issued 28 Feb 2013. The plain-English explanation above is BankPulse’s own independent summary.
Example: if you are a Compliance officer at a bank this circular applies to (AD Category-I banks handling Rupee Drawing Arrangements, Exchange Houses in FATF-compliant countries, NRIs and nationals of FATF-compliant countries sending remittances to India), your first concrete step on “RBI Extends Rupee Drawing Arrangements to FATF-Compliant Countries” is: “Update internal policies to include Exchange Houses in all FATF-compliant countries under Speed Remittance Procedure.” (RBI issued this 28 Feb 2013).
Circular: RBI/2012-13/423 -- RBI Extends Rupee Drawing Arrangements to FATF-Compliant Countries
Issued: 28 Feb 2013
Action required: Update internal policies to include Exchange Houses in all FATF-compliant countries under Speed Remittance Procedure.
Action required: Verify FATF compliance status of any new jurisdiction before onboarding Exchange Houses.
Action required: Train staff on revised permitted transactions for payments to medical institutions and hotels by nationals of FATF-compliant countries.
Action required: Review and amend existing agreements with Exchange Houses to reflect expanded scope.
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.
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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=7873&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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