RBI directs daily reporting of individual transactions by banks under the Liberalised Remittance Scheme (LRS) - (12 Apr 2018)
Banking
In order to improve monitoring and to ensure compliance with the LRS limits, RBI has decided to put in place a daily reporting system by authorised dealer (AD) banks of transactions undertaken by individuals under LRS, which will be accessible to all the other ADs. At present, transactions under Liberalised Remittance Scheme (LRS) are being permitted by AD banks based on the declaration made by the remitter. The monitoring of adherence to the limit is confined to obtaining such a declaration without independent verification, in the absence of a reliable source of information. Accordingly, from the date of issue of the circular, all AD Category-I banks are required to upload daily transaction-wise information undertaken by them under LRS at the close of business of the next working day. In case no data is to be furnished, AD banks shall upload a ‘Nil’ report. The directions have been issued under Sections 10(4), 11(1) and 11(2) of the Foreign Exchange Management Act, 1999 and are without prejudice to permissions/approvals, if any, required under any other law.
Liberalised Remittance Scheme was introduced on February 4, 2004, as a liberalization measure to facilitate resident individuals to remit funds abroad for permitted current or capital account transactions or combination of both. These Regulations are amended from time to time to incorporate the changes in the regulatory framework and published through amendment notifications. Within the contours of the Regulations, Reserve Bank of India also issues directions to Authorised Persons under Section 11 of the Foreign Exchange Management Act (FEMA), 1999. These directions lay down the modalities as to how the foreign exchange business has to be conducted by the Authorised Persons with their customers/constituents with a view to implementing the regulations framed.
Under the Liberalised Remittance Scheme, Authorised Dealers may freely allow remittances by resident individuals up to USD 2,50,000 per Financial Year (April-March) for any permitted current or capital account transaction or a combination of both. The Scheme is not available to corporates, partnership firms, HUF, Trusts, etc. The LRS limit has been revised in stages consistent with prevailing macro and micro economic conditions. The Scheme is available to all resident individuals including minors.
Tags : SCHEME TRANSACTION DAILY REPORTING
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