Amendment in Foreign Exchange Management (current Account Transactions) Rules, 2000 – The Ministry of Finance has issued a notification amending the Foreign Exchange Management (Current Account Transactions) Rules, 2000. The amendment, effective from May 16, 2023, introduces a new rule related to the use of international credit cards while outside India. This article provides an analysis of the amendment and its implications.
Analysis: The amendment inserts a new rule, numbered 7, into the Foreign Exchange Management (Current Account Transactions) Rules, 2000. This rule states that the provisions of rule 5 shall not apply to the use of an International Credit Card for making payments by a person while on a visit outside India. Essentially, this rule allows individuals to use international credit cards to meet their expenses while traveling abroad without being subject to the restrictions of rule 5.
The amendment aims to facilitate the use of international credit cards for seamless transactions while abroad, providing more flexibility to individuals traveling outside India. It recognizes the importance of international credit cards as a convenient payment method for travelers and removes the constraints imposed by rule 5.
Conclusion: The amendment to the Foreign Exchange Management (Current Account Transactions) Rules, 2000, introduced by the Ministry of Finance, allows the use of international credit cards for making payments while outside India. This amendment provides greater convenience to individuals traveling abroad and aligns with the evolving needs of global transactions. By exempting such transactions from the restrictions of rule 5, the amendment promotes ease of use and enhances the overall travel experience.
MINISTRY OF FINANCE
(Department of Economic Affairs)
NOTIFICATION
New Delhi, the 30th June, 2023
G.S.R. 472(E).—In exercise of the powers conferred by section 5 and sub-section (1) and clause (a) of sub-section (2) of section 46 of the Foreign Exchange Management Act, 1999 (42 of 1999), and in consultation with Reserve Bank of India, the Central Government having considered it necessary in the public interest hereby amends the Foreign Exchange Management (Current Account Transactions) Rules, 2000, with effect from the 16th May, 2023, namely:-
In the Foreign Exchange Management (Current Account Transactions) Rules, 2000 after rule 6, the following rule shall be inserted and shall be deemed to have been inserted with effect from the 16th day of May, 2023 namely: –
“7. Use of International Credit Card while outside India.— Nothing contained in rule 5 shall apply to the use of International Credit Card for making payment by a person towards meeting expenses while such person is on a visit outside India.”.
[F. No. 1/5/2023-EM]
SURBHI JAIN, Jt. Secy. (Financial Market)
Explanatory Memorandum
Note : It is certified that by giving retrospective effect to the present notification, no one will be adversely affected.
Note : The principal rules were published in Gazette of India, Extraordinary, Part II, Section 3, Sub-section (i) vide G.S.R. 381(E), dated the 3rd May, 2000 and subsequently amended vide notification numbers –
(i) G.S.R. 663(E), dt 09-08-2000;
(ii) S.O. 301(E) dt 30-03-2001;
(iii) G.S.R. 831(E), dt 17-12-2002;
(iv) G.S.R. 33(E), dt 15-01-2003;
(v) G.S.R. 397(E), dt 01-05-2003;
(vi) G.S.R. 731(E), dt 05-09-2003;
(vii) G.S.R. 849(E), dt 27-10-2003;
(viii) G.S.R. 608(E), dt 13-09-2004;
(ix) G.S.R. 512(E), dt 27-07-2005;
(x) G.S.R. 412(E), dt 10-07-2006;
(xi) G.S.R. 349(E), dt 22-05-2009;
(xii) G.S.R. 382(E), dt 05-05-2010;
(xiii) G.S.R. 426(E), dt 26-05-2015; and
(xiv) G.S.R. 369(E), dt 16-05-2023
