RBI Allows AD Category-II Banks and FFMCs to File LRS Returns Directly on CIMS

Circular No RBI/2025-26/102 A.P. (DIR Series) Circular No. 17; Dated: 03.12.2025

The Reserve Bank of India (RBI) has announced significant changes to the reporting mechanism under the Liberalised Remittance Scheme (LRS) by expanding access to the Centralised Information Management System (CIMS). The revised framework aims to enhance real-time monitoring of LRS transactions and improve compliance across all authorised entities.

1. Earlier Reporting Requirements

Under the previous norms:

1.1 Reporting by AD Category-I Banks

• AD Category-I banks were required to submit the ‘LRS daily return’ on the CIMS portal by the next working day.
• These returns covered:

1. 1. LRS transactions undertaken by the AD Category-I bank itself, and
   2. Transactions conducted by AD Category-II banks/entities and Full-Fledged Money Changers (FFMCs) attached to them or those maintaining an account with them.

This centralised reporting through AD Category-I banks often created dependency and delays.

1.2 New Reporting Framework – Direct Access Granted

RBI has now provided direct access to the CIMS portal for:

• AD Category-II banks/entities
• Full-Fledged Money Changers (FFMCs)

This enables these entities to independently submit their ‘LRS daily return’.

1.3 Key Benefit

AD Category-II banks and FFMCs will now be able to:

• Directly verify the cumulative amount remitted (PAN-wise) by a resident under LRS during the current financial year,
• Before executing the next remittance, thereby strengthening compliance and preventing limit breaches.

2. Mandatory Reporting From January 1, 2026

With this operational change:

• All AD Category-II banks/entities and FFMCs must submit the ‘LRS daily return’ (including ‘nil’ submissions, where applicable) from January 1, 2026.
• These entities may discontinue sending LRS transaction data through AD Category-I banks, as the centralised dependency is removed.

3. Instructions for Submission

All authorised persons, including AD Category-II banks/entities and FFMCs, must:

• Follow the User Manual available under the Downloads section of the CIMS portal for:

1. 1. Log-in procedures
   2. Return submission
   3. Error resolution

4. Support for Newly Onboarded Entities

AD Category-II banks/entities and FFMCs newly onboarded to CIMS may contact the Foreign Exchange Department (FED) of the concerned RBI Regional Office for assistance with technical or procedural issues relating to CIMS access or return submission.

5. Impact of the Change

The revised process:

• Enhances transparency in LRS monitoring
• Reduces operational delays
• Strengthens PAN-wise remittance tracking
• Simplifies compliance for both AD Category-I and Category-II banks
• Minimises dependence on intermediaries for regulatory reporting

Click Here To Read The Full Circular