Authorised Money Changers/ AMCs are entities who are authorised by the Reserve Bank of India as per Section 10 of the Foreign Exchange Management Act of 1999. Accordingly, an AMC may either be a Restricted Money Changer (RMC) or a Full Fledged Money Changer (FFMC). As defined by the Act, an Authorised Person essentially means an authorised dealer, money changer, off-shore banking unit or any other individual for the time being authorised under sub-section (1) of Section 10 to involve in foreign securities or foreign exchange. A license is required by FFMCs to purchase foreign exchange from residents and non-residents visiting India and to sell foreign exchange for specifically approved purposes.
The companies that after obtaining a licence from the Reserve Bank of India (RBI) intents to carry out functions of forex currency or money changer activity is termed as ‘Full Fledged Money Changers’ (FFMCs). Every full fledged money changer is required to follow circular on Memorandum of Instruction on Money Changing Activities published by RBI and also provisions of Foreign Exchange Management Act, 1999 is to be followed by every FFMC licence holder.
No person shall carry on or advertise that he carries on money changing business unless he is in possession of a valid money changer’s licence issued by the Reserve Bank. Any person found undertaking money changing business without a valid licence is liable to be penalised.
Full Fledged Money Changer (FFMC)
A Full Fledged Money Changer (FFMC) is an authorized entity who may purchase foreign exchange from non-residents and residents of India and sell the same for private and business travel purposes only to the people visiting abroad. As Section 10 of the Foreign Exchange Management Act, 1999 prescribes, authorized money changers are the only entities in the country that can deal in money changing activities and offer necessary foreign exchange services. For the purpose of removing the obstacles faced by foreign visitors and tourists, particular firms and hotels have also been offered the registration to deal in foreign currency notes, coins and traveller’s cheques under the directions issued by the RBI frequently.
No individual is permitted to carry on or advertise that they carry on money changing business unless they own a valid money changer’s license issued by the RBI. Any individual found undertaking any sort of money changing business without a valid license is liable to be penalised under the Act.
Activities of FFMCs
The following are the activities that are undertaken by Full Fledged Money Changer (FFMC).
An FFMC may enter into a franchise agreement at their convenience for the purpose of carrying on the Restricted Money Changing business which basically involves the conversion of foreign currency notes, coins or travellers’ cheques into Indian Rupees (INR).
An FFMC or its franchisees may freely purchase any foreign currency notes, coins or traveller’s cheques from the residents as well as the non-residents of India.
An FFMC may sell Indian Rupees (INR) to foreign tourists or visitors against International Debit Cards/ International Credit Cards and take prompt actions in order to obtain reimbursements through normal banking channels.
FFMCs may choose to sell foreign exchange for the following purposes.
- Business Visits
- Private Visits
- Forex Pre-Paid Cards
Full Fledged Money Changer (FFMC)
A Full Fledged Money Changer (FFMC) is an authorized entity who may purchase foreign exchange from non-residents and residents of India and sell the same for private and business travel purposes only to the people visiting abroad. As Section 10 of the Foreign Exchange Management Act, 1999 prescribes, authorized money changers are the only entities in the country that can deal in money changing activities and offer necessary foreign exchange services. For the purpose of removing the obstacles faced by foreign visitors and tourists, particular firms and hotels have also been offered the registration to deal in foreign currency notes, coins and traveller’s cheques under the directions issued by the RBI frequently.
No individual is permitted to carry on or advertise that they carry on money changing business unless they own a valid money changer’s license issued by the RBI. Any individual found undertaking any sort of money changing business without a valid license is liable to be penalised under the Act.
Eligibility to obtain FFMC License
The following are the eligibility criteria that are required in order to operate as a Full Fledged Money Changer (FFMC).
- The Entity that wishes to apply for a Full Fledged Money Changer License must be registered under the Companies Act of 2013.
- The Entity must have a minimum net-owned fund of INR 25 Lakhs in order to apply for a single-branch license and INR 50 Lakhs for a multiple-branch license.
- The object clause of the Memorandum must reflect the activity of money changing that is to be undertaken by the Entity.
- There must not be civil or criminal cases pending against the Entity with the enforcement of the Department of Revenue Intelligence.
- After obtaining the FFMC License, the Entity must carry out its business activity within 6 months from the date of issuance of the Forex License and should, without fail, intimate the RBI.
