RBI Mandates Money Changers to Sell at Least 75% of Bought Foreign Currency Notes to the Public Quarterly

Circular No. RBI/2024-25/39 A.P. (DIR Series) Circular No. 08, Dated: 27.05.2024

As per the master direction on Money-Changing Activities, Full-Fledged Money Changers (FFMCs)/non-bank Authorised Dealers (ADs) Category-II may obtain their normal business requirements of foreign currency notes from other FFMCs and Authorised Dealers (ADs) in India. They must also keep foreign currency balances at reasonable levels to avoid building up idle balances.

Now, the RBI has issued a circular specifying that starting from July 1, 2024, Full-Fledged Money Changers (FFMCs) and non-bank Authorized Dealers Category II (ADs Cat-II) must ensure that the value of foreign currency notes they sell to the public for permitted purposes is at least 75% of the value of the foreign currency notes they purchase from other FFMCs and Ads on a quarterly basis.

Additionally, records of such sales and purchases must be maintained and made available for audit or inspection. FFMCs and ADs selling foreign currency should also verify the ‘sale to public’ requirements of the purchasing FFMCs or non-bank ADs Category II by requesting the necessary data from these entities.

Further, the FFMCs/non-bank ADs Category-II shall submit their annual audited balance sheet to the concerned Regional Office of the Reserve Bank along with a certificate from their statutory auditors regarding the NOF as of the balance sheet date, latest by October 31 of the year concerned.

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