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RBI Allows LRS Remittances for Studies Abroad to IFSCs

No longer current — replaced by Remittances to International Financial Services Centres (IFSCs) under the Liberalised Remittance Scheme (LRS)
Source: Reserve Bank of India · RBI/2023-24/45 · issued 22 Jun 2023 · ~1 min read
Quick answerRBI now permits resident individuals to remit funds under LRS to IFSCs for 'studies abroad' fees to foreign universities/institutions, expanding beyond earlier investment-only scope.

What changed

Previously, LRS remittances to IFSCs were restricted to investments in securities. This circular adds a new purpose: payment of fees for courses at foreign universities or institutions located in IFSCs, as per the government's gazette notification.

What it means for you

Banks can now process LRS remittances to IFSCs for education fees, opening a new channel for students. This aligns IFSCs with broader LRS objectives and may increase transaction volumes for authorised persons. Lenders must update their compliance systems to include this new purpose code.

Historical instruction — do not use for current compliance. This is what was required at the time; it no longer reflects current RBI requirements. If no replacement rule is linked above, that only means none is recorded on our register yet — it does not prove no later applicable rule exists. Confirm on the official RBI source below.

What banks were required to do at the time

Who it affects

Authorised Persons (banks and ADs), Resident individuals seeking to study at foreign institutions in IFSCs, IFSC-based foreign universities and institutions

❓ Common questions

Regulatory timeline

Built from our lineage records — each fact carries its provenance; missing history simply is not shown (never guessed).

Can I now use LRS to pay tuition fees to a foreign university located in an IFSC?

Yes, RBI has allowed remittances under LRS for 'studies abroad' to pay fees to foreign universities or institutions in IFSCs, provided the courses are covered by the government's gazette notification.

What was the earlier restriction on LRS remittances to IFSCs?

Earlier, LRS remittances to IFSCs were only permitted for making investments in securities. This circular expands the scope to include education-related payments.

📜 This document’s life story (1 recorded event, each backed by RBI’s own words)
Superseded by Remittances to International Financial Services Centres (IFSCs) under the Libera
📜 Read the original circular — full text as issued by RBI
RBI/2023-24/45 A.P. (DIR Series) Circular No. 06 June 22, 2023 To All Authorised Persons Madam / Sir Remittances to International Financial Services Centres (IFSCs) under the Liberalised Remittance Scheme (LRS) Attention of Authorised Persons is invited to A.P. (DIR Series) Circular No. 11 dated February 16, 2021 and A.P. (DIR Series) Circular No. 03 dated April 26, 2023 on “Remittances to International Financial Services Centres (IFSCs) in India under the Liberalised Remittance Scheme (LRS)”. 2. Presently, remittances to IFSCs under LRS can be made only for making investments in securities in terms of A.P. (DIR Series) Circular No. 11 dated February 16, 2021 . In view of the gazette notification no. SO 2374(E) dated May 23, 2022 issued by the Central Government, it is directed that Authorised Persons may facilitate remittances by resident individuals under purpose ‘studies abroad’ as mentioned in Schedule III of Foreign Exchange Management (Current Account Transactions) Rules, 2000 for payment of fees to foreign universities or foreign institutions in IFSCs for pursuing courses mentioned in the gazette notification ibid. 3. Authorised Persons shall bring the contents of this circular to the notice of their constituents and customers. 4. 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, (Ajay Kumar Misra) Chief General Manager-in-Charge
Reproduced for reference with acknowledgment — Source: Reserve Bank of India · RBI/2023-24/45 · issued 22 Jun 2023. The plain-English explanation above is BankPulse’s own independent summary.
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Official RBI source: https://www.rbi.org.in/Scripts/NotificationUser.aspx?Id=12518&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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