All Chief Executives of
Exchange Companies

Dear Sirs,

Outward Remittances on Account of Trade Related Transactions /
Payment of Services / Commission

It has been observed that certain Exchange Companies are indulging in outward remittances on account of trade related transactions / payment of services / commission etc. In this respect, attention of the Exchange Companies is drawn to the Rules & Regulations governing their business, in terms of which an exchange Company is authorized to effect outward remittances only on personal account of individuals i.e. personal financial transactions and not those related to an individual’s trade or business requirements. Further, as per F.E Circular No.9 of July 30, 2002, corporate clients may approach for remittances only on account of payment of royalty, technical / franchise fee, provided NOC to this effect is provided to the Exchange Companies from the designated Authorized Dealers.

All Exchange Companies are, therefore, advised to strictly adhere to the Rules & Regulations and not effect remittance on account of trade related activities / payments against services / commission etc., whether on account of individual or on behalf of corporate clients. In order to ensure adherence to the above in true sprit, while accepting funds for remittances abroad, Exchange Companies are advised to exercise maximum care and carry out necessary due diligence on their part to ensure that the remittances are on personal account only and in no way these relate to trade related transactions.