Receipt in foreign exchange

If authorized dealer receives any foreign payment by way of either remittance or by reimbursement or any other payment shall be in the manner as stated below:

Member of Asian Clearing Union (ACU):

In case of Bangladesh, Myanmar, Pakistan, Sri-Lanka and Maldives: Payment should be made by credit to ACU Dollar account and ACU Euro account.

• In any other cases: Receipt can be in any freely convertible currency.
• In case of export from India to Myanmar: Receipt can be in any currency
• In case Nepal and Bhutan: Payment can be in rupees.
• In case of export to Nepal: Receipt can be in foreign exchange if specifically permitted by Nepal Rastriya Bank.
• In case of Islamic Republic of Iran: It will be as per direction of Reserve Bank of India Foreign exchange Management Regulation (Manner of Receipt and Payment) Regulation, 2016 Regulation.
• In case of other countries: Receipt can be in rupees or any freely convertible currency.

Manner of Receipt in case of exports:

As per the provisions of Regulation 4 of Foreign Exchange Management (Manner of Receipt and Payment) Regulation, 2016, payment for export can be received in following form:

• In the form of bank draft, cheque, pay order, foreign currency notes/travellers cheque from a buyer during his visit to India, provided that the foreign currency so received is surrendered within the specified period to the authorised dealer.
• An Exporter can receive his export payment by debit to Foreign Currency Non-Resident (FCNR)/ Non-Resident External (NRE) account maintained by the authorised dealer or an authorised Bank in India.
• In rupees from the credit card servicing bank in India against the charge slip signed by the buyer where such payment is made by the buyer through credit card.
• From the rupee account held in the name of Exchange House with an authorised dealer if the amount does not exceed 15 Lakh rupees per export transaction.
• As per the directions issued by the Reserve Bank of India to authorised dealers, where the export is covered by an arrangement between the Central Government and the Government of foreign country or by the Exim Bank entered into by the Exim Bank with a Financial Institution in foreign state.
• In the form of precious metals i.e. gold/silver/platinum equivalent to the value of jewellery unit in SEZ and EOU, if a sale contract provides for the same and the value is declared in the relevant EDF.

Payment can be received in Cash from foreign travellers in India:

While visiting India, foreign traveller can make the payment in foreign exchange in India while making purchase across the counter. As per RBI, Guidelines, this Foreign exchange should be surrendered to authorised persons in India.

Such foreign Exchange shall be treated as earning in foreign exchange and the service provider shall be eligible to claim benefit under Export Promotion Capital Goods Scheme and Served From India Scheme.

Receipt through postal order or postal money order:

As per regulation 4(2) of Foreign Exchange Management (Manner of Receipt and Payment) Regulation, 2016, Person Residents in India can receive foreign payment from other than exports, by postal order by post office outside India or Postal money order issued by foreign post office.

Asian Clearing Union (ACU):

ACU was established to settle the payments for current international transactions within the ESCAP region (United Nations Economic and Social commission for Asia and Pacific) on a multilateral basis.

Agreement to establish ACU was approved by Central Banks and monetary authorities of regional members and was signed on their behalf by Board of Directors of ACU. ACU (Procedure) Rules have been also adopted by the Board of Directors of ACU.

Asian Clearing Memorandum: Memorandum of procedure for channelling transactions through Asian Clearing Union (ACU) issued by RBI contains detailed procedure to be followed by authorised dealers for handling transactions which are to be cleared through ACU.

Transactions will be handled by authorised dealers in the same manner as other normal foreign exchange transactions.”