Brief Overview:
RBI introduces the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023 (“Regulations”) specifying the payment and receipt mechanism for trade and non-trade related transactions. The Regulations will supersede the earlier regulations on the subject matter.
Technical Details:
The Regulations have specified the manner in which persons resident in India shall make or receive payment from a person resident outside India.
Key transaction channels and manner of remittance are provided below:
| Transaction Channel | Receipt/payment to or from Nepal and Bhutan | Receipt/payment to or from member countries of Asian Clearing Union (“ACU”) | Receipt/payment to or from other countries |
| Trade Transactions (for export or import) | Indian Rupees*
|
Through ACU mechanism or as per RBI directions* | Indian Rupees or any foreign currency* |
| Non-Trade Transactions | Indian Rupees* | Please refer to the next column | Indian Rupees or any foreign currency*
For any current account transactions, between any person resident in India and a person resident outside India, who is on a visit to India, may be made only in Indian Rupees. |
JC takeaway:
These Regulations specifically streamline the manner of payment and receipt for any current account transaction in India, other than a trade transaction, between any person resident in India and a person resident outside India, who is on a visit to India.
For further details, please see:
https://rbi.org.in/Scripts/NotificationUser.aspx?Id=12579&Mode=0
For any queries / clarifications, please feel free to ping us and we will be happy to chat
● Mr. Saurabh Sharma (saurabh.sharma@jclex.com)
● Ms. Rupul Jhanjee (rupul.jhanjee@jclex.com)
