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Forex Facilities for Residents
(Individuals)

46. Are there any restrictions on the kind/quality of debt or equity instruments an individual can invest in? +

No ratings or guidelines have been prescribed under the Liberalised Remittance Scheme of USD 25,000 on the quality of the investment an individual can make. However, the individual investor is expected to exercise due diligence while taking a decision regarding the investments which he or she proposes to make.

47. Whether banks can invest in Fixed Deposits of non-banking non-financial companies? +

There is no prohibition on banks' placing of funds with non-banking non-financial companies under their Public Deposit Scheme. However, such investment in the Public Deposit Scheme should be classified by banks as loans/advances in their balance sheet and returns under the Banking Regulation Act, 1949 and fortnightly returns by scheduled commercial banks under Reserve Bank of India Act , 1934.

47. Whether an investor is entitled for any compensation for the late receipt/ delayed credit of interest warrants/maturity value of investments, etc.? +

The bank shall compensate the investors for the above mentioned financial loss at a fixed rate of 8% per annum (with effect from April 10, 2012).

47. ಪಿಪಿಐ ನೀಡಿಕೆದಾರರು ಒಂದೇ ಗ್ರಾಹಕರಿಗೆ ಒಂದಕ್ಕಿಂತ ಹೆಚ್ಚು ಪಿಪಿಐಗಳನ್ನು ನೀಡಬಹುದೇ?

ಉತ್ತರ. ಪಿಪಿಐ ನೀಡಿಕೆದಾರರು ಗ್ರಾಹಕರಿಗೆ ಈ ಕೆಳಗಿನ ಎರಡು ಪ್ರಕಾರಗಳಲ್ಲಿ ಯಾವುದೇ ಒಂದನ್ನು ನೀಡಬಹುದು:
ಎ] ಕನಿಷ್ಠ ವಿವರದ ಸೆಮಿ-ಕ್ಲೋಸ್ಡ್ ಪಿಪಿಐ;
ಬಿ]ಕೆವೈಸಿ ಕಂಪ್ಲೈಂಟ್ ಸೆಮಿಕ್ಲೋಸ್ಡ್/ಓಪನ್ ಸಿಸ್ಟಮ್ ಪಿಪಿಐ;

Q.47. If companies in the Promoter Group have significant interest /control in regulated and / or unregulated financial services activities, but do not wish to participate in the set-up of a new bank, is this permissible or do they need to necessarily exit from their interests in the company/group of companies wishing to promote a new bank. +

A. The Promoters/Promoter Group have to first set up a wholly owned NOFHC for holding the bank. They cannot set up a bank directly. In case, some entities/companies in the Promoter Group having ‘significant influence’ or ‘control’ (as defined in Accounting Standard-23) in regulated or unregulated financial services activities do not wish to participate in the voting equity of the NOFHC, they can do so. However, the regulated financial services entities, in which the companies in the Promoter Group have ‘significant influence’ or ‘control’ (as defined in Accounting Standard-23), have to come under the NOFHC. The unregulated financial services activities/entities of the Promoter Group cannot come under the NOFHC. [para 2 (C) (i), (ii), (iii) & (vii) of the guidelines]

47.Whether minor resident Individuals would be permitted to open, maintain and hold such foreign currency accounts if the same is permissible as per local law in the country of the overseas branch? +

Banks may take necessary steps in the matter based on the settled legal position regarding enforcement of the declaration in case the remittance is made on behalf of a minor.

Q.47 Are there any other provisions by which an individual can acquire shares of a foreign company ? +

Yes, a person resident in India, being an individual, who is an employee or a director of Indian office or branch of a foreign company or of a subsidiary in India of a foreign company or of an Indian company in which foreign equity holding is not less than 51 per cent, may purchase the equity shares offered by the said foreign company: -Provided that the shares are offered at a concessional price.

Q.48 Can one acquire shares of a foreign company in his capacity as director ? +

Yes, Reserve Bank has given general permission to a person resident of India to acquire foreign security to the extent of the minimum number of qualification shares required to be held for holding the post of Director and this amount shall not exceed 1% of the paid-up capital of the company subject to a limit of USD 20,000 in a calendar year.

48. ಮೇಲೆ ನಮೂದಿಸಿರುವ ಪ್ರಕಾರಗಳಲ್ಲಿ, ಅನೇಕ ಸಹಬ್ರ್ಯಾಂಡಿಂಗ್ಪಾಲುದಾರರಂತಹ ಕಾರಣಗಳಿಗೆ ಪಿಪಿಐ ನೀಡಿಕೆದಾರರು ಒಂದೇ ಗ್ರಾಹಕರಿಗೆ ಅನೇಕ ಪಿಪಿಐಗಳನ್ನು ನೀಡುತ್ತಿದ್ದ ಸಂದರ್ಭದಲ್ಲಿ ; ವಾಲೆಟ್ ಹಾಗೂ ಕಾರ್ಡ್; ಮುಂತಾದಂತಹ ವಿವಿಧ ರೂಪಗಳಲ್ಲಿ ಮಿತಿಗಳನ್ನು ಹೇಗೆ ಪರಿಗಣಿಸಲಾಗುತ್ತದೆ? +

ಉತ್ತರ.

ಮೇಲೆ ನಮೂದಿಸಿರುವ ಪ್ರಕಾರಗಳಲ್ಲಿ, ವಿವಿಧ ಕಾರಣಗಳಿಂದಾಗಿ [ಉದಾ. ಅನೇಕ ಸಹ-ಬ್ರ್ಯಾಂಡಿಂಗ್ ಪಾಲುದಾರರು, ವಾಲೆಟ್ಗಳು/ಕಾರ್ಡ್ಗಳಂತಹ ವಿಭಿನ್ನ ರೂಪಗಳಲ್ಲಿ ಪಿಪಿಐನ ನೀಡಿಕೆ] ಪಿಪಿಐ ನೀಡಿಕೆದಾರರು ಒಂದೇ ಗ್ರಾಹಕರಿಗೆ ಅನೇಕ ಪಿಪಿಐಗಳನ್ನು ನೀಡುತ್ತಿದ್ದರೆ, ಆಗ ಪಿಪಿಐ ನೀಡಿಕೆದಾರರು ಕೇಂದ್ರೀಕೃತ ಡೇಟಾಬೇಸ್ /ಮ್ಯಾನೇಜ್ಮೆಂಟ್ ಇನ್ಫಾರ್ಮೇಶನ್ ಸಿಸ್ಟಮ್ [ಎಮ್ಐಎಸ್]ಮೂಲಕ ಮಿತಿಗಳನ್ನು ಮೇಲ್ವಿಚಾರಣೆ ಮಾಡುತ್ತಾರೆ.

ಉದಾಹರಣೆಗಾಗಿ , ವಿವಿಧ ವ್ಯವಸ್ಥೆಗಳು/ ಫಾರ್ಮ್ ಪ್ಯಾಕ್ಟರ್[ರಚನೆಯ ಅಂಶದ] ಅಡಿಯಲ್ಲಿ ನಿರ್ದಿಷ್ಟ ಪಿಪಿಐ ನೀಡಿಕೆದಾರರಿಂದ ಗ್ರಾಹಕರಿಗೆ ನೀಡುವ ಎಲ್ಲಾ ಕೆವೈಸಿ ಕಂಪ್ಲೈಂಟ್ ಪಿಪಿಐಗಳಲ್ಲಿನ ಮೌಲ್ಯವನ್ನು ಸಂಯೋಜಿಸಿದ ನಂತರ ಯಾವುದೇ ಸಮಯದಲ್ಲಿ 1,00,000/-ಮಿತಿಯನ್ನು ಲೆಕ್ಕಹಾಕಲಾಗುತ್ತದೆ.

ಅಂತೆಯೇ ಪಿಪಿಐ ಎಮ್ಡಿಯ ಪ್ಯಾರಾಗ್ರಾಫ್ 9.1[i]ಯಲ್ಲಿನ 10,000ದ ಮಿತಿಯು ಎಲ್ಲಾ ಕನಿಷ್ಠ ವಿವರ ಪಿಪಿಐ[ ವಿವಿಧ ವ್ಯವಸ್ಥೆಗಳು/ ಫಾರ್ಮ್ ಪ್ಯಾಕ್ಟರ್ಅಡಿಯಲ್ಲಿ ಪಿಪಿಐ ನೀಡಿಕೆದಾರರಿಂದ ನೀಡಿದ] ಗಳಾದ್ಯಂತದಲ್ಲಿದೆ .

ಹೀಗಿದ್ದಾಗ್ಯೂ, ಪಿಪಿಐ-ಎಮ್ಡಿಯ ಪ್ಯಾರಾಗ್ರಾಫ್ 10 ರಲ್ಲಿ ನಮೂದಿಸಿದ [ಮಾಸ್ ಟ್ರಾನ್ಸಿಟ್ ಸಿಸ್ಟಮ್ [ಪಿಪಿಐ-ಎಮ್ಟಿಎಸ್]ಗಾಗಿ ಗಿಫ್ಟಿಂಗ್ ಉಪಕರಣಗಳು ಹಾಗೂ ಪಿಪಿಐಗಳು]ಎರಡು ವರ್ಗಗಳು ಮಿತಿಗಳನ್ನು ಒಳಗೊಂಡಿರುವುದಿಲ್ಲ.

Q.48. In the event the NOFHC/ bank being promoted by a sub-set of existing promoters (having regard to the definition of “Promoter/ Promoter Group”), would the regulated financial services entities of the remaining Promoter Group (not promoting the NOFHC/ bank), be required to become subsidiaries of the NOFHC? +

A. Yes. All the regulated financial services entities in which the Promoter Group has ‘significant influence’ or ‘control’ (as defined in Accounting Standard 23) will have to be brought under the NOFHC as subsidiaries, or associates or joint ventures. [para 2 (C) (iii) & (vii) of the guidelines]

Electronic Clearing Service (Credit Clearing) Mandate Form

(Investor (s)’s option to receive redemption proceeds and
interest payments through Credit Clearing Mechanism)

Investor(s) Name and Address

Member ID No./BLA No.
PAN/GIR No.*
Telephone No./Mobile No./E-mail ID

:
:
:

Particulars of Bank account

Name of the Bank
Name of the branch
1. Address
2. Telephone No.
9-Digit MICR code number of the bank and branch appearing on the MICR cheque issued by the bank
Type of the account (Savings, Current or Cash Credit) with codes -10/11/13
Ledger and Ledger folio number
Account number (as appearing on the cheque book)

:
:
:
:
:

:
:

(In lieu of the bank certificate to be obtained as under, please attach a blank cancelled cheque or photocopy of a cheque or front page of your savings bank passbook issued by your bank for verification of the above particulars)

4. Date of effect :

I/We hereby declare that the particulars given above are correct and complete. If the transaction is delayed or not effected at all for reasons of incomplete or incorrect information, I/We would not hold the user institution responsible. I/We have read the option invitation letter and agree to discharge the responsibility expected of us as a participant under the scheme.

Date:

(.....................................)
Signature(s) of the Investor(s)

(In case of joint holdings, all the investors, whose signatures are registered with PDOs, should sign here)

Certified that the particulars furnished above are correct as per our records.

Bank’s Stamp:

Date:

(.................................)
Signature of the authorised official of the Bank

* Compulsory for investors due to receive maturity proceeds exceeding Rs. One lakh

These FAQs are issued by the Reserve Bank of India for information and general guidance purposes only. The Bank will not be held responsible for actions taken and/or decisions made on the basis of the same. For clarifications or interpretations, if any, investors are requested to be guided by the relevant circulars and notifications issued from time to time by the Bank and the Government as well as the relevant provisions of the Government Securities Act, 2006 and the Government Securities Regulations, 2007.

48.Whether credit facilities in Indian Rupees or foreign currency would be permissible against security of such deposits? +

No. The Scheme does not envisage extension of credit facility against the security of the deposits.

48. Whether banks can purchase letter of allotment in respect of PSU Bonds? +

Banks can purchase letter of allotment in respect of PSU bonds subject to following conditions. 1. The transaction (other than inter bank transaction) should be undertaken only through recognised Stock Exchanges and registered brokers. 2. While purchasing the security, the bank should ensure that it gets a clear title to the security and the security is traded in the secondary market. The bank should formulate their own internal guidelines with the approval of the Board for undertaking such transaction.

Q.49 Can a resident individual subscribe to the rights issue of shares held by him ? +

Yes, Reserve Bank on an application may permit a person resident in India to acquire foreign securities by way of rights shares issued by a company incorporated outside India up to an amount not exceeding US$ 20,000 in a block of five calendar years in case the existing shares were held in accordance with the provisions of the law.

49. What should be the method of valuation for advances against shares/debentures /bonds? +

Shares/debentures/bonds should be valued at prevailing market prices when they are lodged as security for advances.

49. What is meant by interoperability? Are PPIs interoperable? +

Ans. Interoperability is the technical compatibility that enables a payment system to be used in conjunction with other payment systems. Interoperability has been allowed in PPIs through circular dated October 16, 2018 and it has been made mandatory vide circular dated May 19, 2021.

Q.49. Will 10 years of successful track record be limited to only financial services sector or to overall business activities? Does every entity forming part of the Promoter Group need to have a 10 year track record? +

A. The overall track record of the Promoters/Promoter Group for at least 10 years will be seen in all its activities both financial and non-financial. If some, but not all, companies forming part of the Promoter Group have been in existence for less than 10

49.Can bankers open foreign currency accounts in India for residents under the Scheme? +

No. Banks in India can not open a foreign currency account in India for residents under the Scheme.

Q.50 Are there any relaxations for individual employees/directors of an Indian company engaged in the field of software for acquisition of shares in their JV/WOS abroad ? +

Yes, Reserve Bank on an application will permit the individual employees/directors of an Indian promoter company engaged in the field of software for acquisition of shares of a JV/WOS abroad provided -the consideration for purchase does not exceed US$ 10,000 or its equivalent per employee in a block of five calendar years,the shares so acquired do not exceed 5% of the paid-up capital of the Joint Venture or Wholly Owned Subsidiary outside India, andafter allotment of such shares, the percentage of shares held by the Indian promoter company, together with shares allotted to its employees is not less than the percentage of shares held by the Indian promoter company prior to such allotment.Further, Reserve Bank may also on an application made to it by an Indian company engaged in the field of software allow its resident employees (including working directors) to purchase foreign securities under the ADR/GDR linked stock option scheme provided the consideration for purchase does not exceed US$ 50,000 or its equivalent in a block of five calendar years.

50. Whether the banks can sanction bridge loans to companies? +

Yes. For a period not exceeding one year against the expected equity flows/issues as also against the expected proceeds of Non-convertible Debentures, External Commercial Borrowings, Global Depository Receipts and/or funds in the nature of Foreign Direct Investments, provided the bank is satisfied that the borrowing company has made firm arrangements for raising the aforesaid resources/funds. Such loans are required to be accommodated within the ceiling of 5% of outstanding advances of the previous year.