JOIN USThe Reserve Bank of India (RBI) has said the residents with foreign currency accounts are not required to convert their foreign funds into rupee, however, the same stands applicable to exporters.
“On a review, it is advised that the provisions will not apply to the Resident Foreign Currency Account,” RBI said in a notification. Notably, the central bank on May 10, 2012 had asked exporters to convert 50 per cent of their foreign exchange earnings into rupee to arrest the sharp fall in the value of the rupee against the US dollar.
No extra interest
Meanwhile, RBI has also directed banks not to provide one per cent additional interest rate to its non-resident existing or retired staff members.
“On a review, it has now been decided that banks should not allow the benefit of additional interest rate on any type of deposits of non-residents,” RBI said in a notification.
The discretion given to banks to allow the benefit of additional interest rate of one per cent per annum as available to bank’s own staff on deposits under Foreign Currency Non-Resident (FCNR) accounts stands withdrawn,” it said.
The central bank has also withdrawn similar discretion given to banks with regard to Non-Resident Ordinary (NRO) and Non-Resident External (NRE) Accounts. All other instructions in this regard, as amended from time to time, will remain unchanged.