Master Direction – Money Transfer Service Scheme (MTSS) (Updated as on September 29, 2026)
UR
- Applies toBanks, money changers and post offices approved to send money transfers (MTSS agents)
- StatusIn force
- IssuedFeb 23, 2017
- Amendmentsnone tracked
- Length28 points in 2 sections · 3 min read
The four dates on this rule
- PublishedFeb 23, 2017The day RBI put this document out. This is the same day as the Issued date on this rule.
- Starts to applyNot statedNot stated separately in this document. Read the rule itself before you assume a start date.
- Time to get readyNot statedCannot be worked out until the day it starts to apply is known.
- Last date to actNot statedNo date to act by was found in this document. Other dates may sit inside single paragraphs.
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Numbers to remember
| Rs 50 lakh | A bank or money changer needs at least Rs 50 lakh of its own funds to become an agent. RBI Para 3 |
| three days | Overseas Principals may keep collateral at a designated bank in India: three days' average drawings, or USD 50,000 if higher. RBI Para 3 |
| Rs 50,000 | A beneficiary in India may be paid up to Rs 50,000 in cash. RBI Para 3 |
| 15 days | An Indian Agent must report new sub-agents to RBI within 15 days of each quarter's end. RBI Para 5 |
| three months | Within three months from the date of RBI's circular, Indian Agents must end agreements with sub-agents that fail these criteria. RBI Para 5 |
| one month | An agent must apply to renew its permission at least one month before it expires. RBI Para 6 |
What it says
How firm is each point
Stated by RBI — RBI’s own paragraph says this. We have only made it plainer.
Our reading — BankPulse read RBI’s paragraph and shortened it. The paragraph is the authority, not this line.
Needs judgement — RBI leaves this to the bank to settle, so nobody can give you a fixed number here.
Must know
1. Only personal inward transfers
MTSS allows only personal transfers into India, such as family maintenance or money for foreign tourists visiting India.
2. No sending money abroad
No money can be sent out of India under MTSS.
3. Who may apply to join
Only Category I or II Authorised Dealers, full-fledged money changers, scheduled commercial banks or the Department of Posts may apply.
4. Net worth needed to join
A bank or money changer needs at least Rs 50 lakh of its own funds to become an agent.
5. Declare no enforcement case
Applicants must declare that no law-enforcement proceedings or criminal cases have begun or are pending against them or their directors.
6. Security money from abroad
Overseas Principals may keep collateral at a designated bank in India: three days' average drawings, or USD 50,000 if higher.
7. Least amount as foreign currency
At least USD 50,000 of that security money must be kept as a foreign currency deposit.
8. Cap on one transfer
RBI has capped a single money transfer under this scheme at USD 2500.
9. Cash limit for a beneficiary
A beneficiary in India may be paid up to Rs 50,000 in cash.
10. Yearly cap per person
One person can receive only 30 money transfers under this scheme in a calendar year.
11. PSS Act licence needed
The foreign partner must first get RBI's payment-system licence under the PSS Act, 2007.
12. Foreign partner needs a licence
The foreign partner must be licensed for money transfer in its own home country.
13. Foreign partner's own net worth
The foreign money transfer company must hold at least USD 1 million of its own net worth at all times.
14. Report new sub-agents quarterly
An Indian Agent must report new sub-agents to RBI within 15 days of each quarter's end.
15. Checking a sub-agent every year
An Indian Agent must run these background checks on a sub-agent at least once a year.
16. Drop a failing sub-agent
Within three months from the date of RBI's circular, Indian Agents must end agreements with sub-agents that fail these criteria.
17. Spot audits every month
An Indian Agent must run spot audits at every sub-agent location at least once a month.
18. Indian Agent answers for sub-agents
The Indian Agent, not RBI, is responsible for everything its own sub-agents do.
19. When to apply for renewal
An agent must apply to renew its permission at least one month before it expires.
20. Paying into a KYC account
A bank receiving the transferred money into an account must first check that the account is KYC-compliant.
21. Check KYC before paying out
If an account is not yet KYC-compliant, the bank must complete its checks before paying out the money.
22. Yearly certificate to RBI
Every Indian Agent must send RBI its yearly audited accounts and a certificate on its own funds.
23. Report a funds shortfall
An agent whose own funds fall below the minimum must tell RBI at once, with a plan to fix it.
Do it
1. Collateral reviewed every quarter
An Indian Agent must review its security money every quarter, based on the last three months.
2. How long a permission lasts
RBI first issues permission for one year; it may then renew it for one to three years at a time.
3. RBI's power to inspect agents
RBI may inspect Indian Agents under Section 12(1) of FEMA, 1999.
4. Keep the recipient's papers
The bank must keep the recipient's identification papers under the money-laundering record rules.
5. Non-bank election cash limit
Election-time cash movement is capped at Rs 10,00,000, or USD 1,00,000 in foreign currency, except imported currency going to offices.