1. What is included in the Liberalised Remittance Scheme (LRS)?
- Personal Visit (BTQ)
- Business Visit (BT)
- Business Promotion
- Training Programme
- Conference Visit
- Overseas Education
- Employment / Immigration
- Medical Treatment
2. What are the limits under the LRS scheme?
Under the Liberalised Remittance Scheme (LRS), individuals have a general limit of USD 250,000 per fiscal year for foreign exchange purposes, covering categories like gifts/donations, close relative maintenance, NRI/PIO repatriation, employment/immigration, and medical treatment.
3. What documentation is required for different purposes under LRS?
- Personal Visits:
- Copy of Passport, Pan-card Mandatory, Visa, and Ticket along with signed Application Form.
- Business Visits:
- Request letter from the company with FEMA declaration along with Copy of Passport and Ticket (Every Transactions).
- Documents: Copy of PAN Card, GST certificate Telephone Bill, Authorization Letter for Employee dealings, Copy of MOA/AOA/ROC or Partnership Deed, or any registration certificate(one-time registration required).
- Overseas Education:
- Copy of Passport, Visa, Offer Letter from the university, and Ticket along with signed Application Form.
- Employment / Immigration:
- Copy of Passport, Visa, Offer Letter from the company, and Ticket along with signed Application Form.
- Medical Treatment:
- Copy of Passport, Visa, Ticket, and supporting documents for medical treatment along with signed Application Form
4. How can I sell my foreign exchange?
You can sell your foreign exchange to encash it into Indian Rupees with us at the best currency exchange rate in Chennai.
Requirements:
- Provide a copy of ID cum Address Proof for documentation.
- If the forex amount encashed exceeds USD 5,000, you must submit a Custom Declaration Form (CDF).
Payout Limits:
- Cash payout in Indian Rupees is restricted to USD 1,000 or its equivalent.
- Any excess will be paid by crossed cheque in your favor.
- For Foreign Nationals & NRIs, the limit is extended to USD 3,000.
5. How can I buy foreign exchange and make outward remittances?
You can buy foreign exchange against Indian Rupees with us at the best rates for various purposes, including personal tours, business tours, training, conference visits, film shooting, overseas studies, medical treatment, employment and immigration, gifts or donations, and family maintenance – (We have tied-up with Top-tier Authorised Dealers).
Payment Limits:
- Cash payment in Indian Rupees is restricted to ₹50,000 per trip.
- Any excess will be paid via crossed cheque,UPI, RTGS, or NEFT in our favor.
Documentation Required: Details on the purpose of visit, forex limits allowed, and necessary documentation are mentioned below:
- Purpose of Visit: Details are as follows, with Currency Notes allowed up to USD 3,000 or equivalent. The balance can be drawn in forms like Prepaid Forex Card, Travelers Cheques, Bank Draft, or Wire Transfer.
FAQs for Borderless Prepaid Cards:
1. What is a Borderless Prepaid Card?
It’s a prepaid multi-currency card for international travelers, enabling purchases and ATM withdrawals in multiple currencies without conversion fees on supported currencies.
2. How Can I Load Funds?
Funds can be added via online banking, authorized branches, or linked bank accounts in supported currencies.
3. How Do I Check My Balance?
Balance and transactions can be monitored through an online portal or a mobile app.
4. What If My Card is Lost or Stolen?
Contact customer support immediately to block the card and request a replacement.
5. What Fees Are Associated with the Card?
There may be issuance, reload, inactivity, and transaction fees. Refer to the service’s terms for a full breakdown.
6. What Currencies Are Supported?
The card supports popular currencies like USD, EUR, GBP, CAD, AUD, and others based on location and provider specifications.
7. Can I Use the Card for Online Purchases?
Yes, the card can be used for online shopping in supported currencies, with funds drawn from the relevant currency balance.
8. How Long Does it Take for a Reload to Reflect?
Usually, reloading takes a few hours, but it may vary depending on the provider and payment method used.
9. Are There Transaction Limits?
Daily limits may apply for both ATM withdrawals and POS transactions, which vary depending on the issuing bank.
10. What Exchange Rate is Applied?
For transactions outside supported currencies, the exchange rate at the time of the transaction will be applied, often with a small conversion fee.
Liberalised Remittance Scheme (LRS)
The Liberalised Remittance Scheme (LRS) in India, governed by the Foreign Exchange Management Act (FEMA) of 1999, allows Indian residents to remit up to USD 250,000 per financial year for specified permissible transactions. This scheme is particularly beneficial for personal transactions such as education, travel, gifting, and investing abroad.
Q 1. What is the Liberalised Remittance Scheme (LRS) of USD 2,50,000?
Ans. Under the LRS, all resident individuals, including minors, are allowed to remit up to USD 2,50,000 per financial year for any permissible current or capital account transaction. This scheme was introduced in February 2004 and the limit has been revised over time. It is not available to corporates, partnership firms, HUF, trusts, etc. For minors, the declaration form must be countersigned by the guardian.
Q 2. What are the prohibited items under the Scheme?
Ans. The following remittances are prohibited under LRS:
- Purchase of lottery tickets, sweepstakes, proscribed magazines, etc.
- Remittance for margin calls to overseas exchanges.
- Purchase of FCCBs issued by Indian companies in the overseas market.
- Trading in foreign exchange abroad.
- Remittances to non-cooperative countries as per FATF.
- Gifting by a resident to another resident in foreign currency.
Q 3. What are the purposes under FEM (CAT) Amendment Rules, 2015, for which a resident individual can avail foreign exchange facility?
Ans. Purposes include private visits (except to Nepal and Bhutan), gift/donation, employment abroad, emigration, maintenance of relatives abroad, business travel, attending conferences, medical treatment abroad, studies abroad, and other current account transactions not prohibited under FEMA.
Q 4. Under LRS, are resident individuals required to repatriate income earned on investments abroad, over and above the principal amount?
Ans. No, they are not required to repatriate income earned from investments. However, unused foreign exchange should be repatriated to India within 180 days.
Q 5. Can remittances under the LRS facility be consolidated in respect of family members?
Ans. Yes, remittances can be consolidated for family members, provided each family member adheres to the conditions of the scheme. For capital account transactions, each family member must be a co-owner or co-partner.
Q 6. Is the AD required to check the permissibility of remittances based on the nature of the transaction or allow it based on the remitter’s declaration?
Ans. The AD will verify the transaction based on the nature of the transaction declared by the remitter in Form A2, but the ultimate responsibility lies with the remitter to ensure compliance with FEMA regulations.
Q 7. Is it mandatory for resident individuals to have a Permanent Account Number (PAN) for sending outward remittances under the Scheme?
Ans. Yes, PAN is mandatory for all transactions under LRS.
Q 8. Are there any restrictions on the frequency of remittances?
Ans. There are no restrictions on the frequency of remittances, but the total remittance in a financial year should not exceed the limit of USD 2,50,000.
Q 9. Can resident individuals remit income exceeding USD 2,50,000 if the remittance is for net salary?
Ans. No, the limit applies to all remittances. However, a resident individual who is not permanently residing in India may remit net salary even if they have exhausted the limit, with RBI approval.
Q 10. Does the restriction of having a bank account for one year apply to current account transactions under LRS?
Ans. No, the one-year account maintenance requirement applies only to capital account transactions.
Q 11. Are there any restrictions on remittances to Mauritius and Pakistan for permissible current account transactions?
Ans. Yes, there are specific restrictions for remittances to these countries as per RBI guidelines.
Q 12. What are the requirements for the remitter under LRS?
Ans. The remitter must ensure compliance with FEMA regulations and submit necessary documents including PAN and Form A2.
Q 13. Can remittances be made only in US Dollars?
Ans. No, remittances can be made in any foreign currency, not just US dollars, subject to the LRS limit.
Q 14. Are intermediaries expected to seek specific approval for making overseas investments available to clients?
Ans. Yes, intermediaries need to ensure that investments are made in accordance with LRS guidelines and seek approval as required.
Q 15. Are there any restrictions on the kind/quality of debt or equity instruments an individual can invest in?
Ans. No specific restrictions are imposed on the kind of debt or equity instruments, but investments should comply with FEMA regulations.
Q 16. Can credit facilities in Indian Rupees or foreign currency be extended by AD banks to resident individuals?
Ans. Yes, AD banks can extend credit facilities to residents under the applicable rules of the LRS.
Q 17. Can banks open foreign currency accounts for residents under LRS?
Ans. Yes, foreign currency accounts can be opened by banks for residents under LRS for permissible current account transactions.
Q 18. Can an Offshore Banking Unit (OBU) in India be treated on par with a branch of a bank outside India for the purpose of opening foreign currency accounts?
Ans. Yes, OBUs in India are allowed to treat residents on par with foreign bank branches for opening foreign currency accounts under the LRS.
Q 19. What documents are required for remittance under LRS for purposes mentioned in Schedule III of FEMA (CAT) Amendment Rules, 2015?
Ans. Required documents include Form A2, PAN, passport, and any other documents validating the purpose of the remittance (such as admission letters for studies, medical bills, etc.).
Q 20. Are documents like 15CA and 15CB required for all outward remittances, including those for maintenance?
Ans. Yes, documents such as 15CA and 15CB may be required for certain transactions under LRS.
Q 21. Will expenses incurred by an LLP to sponsor the education of its partners be outside the LRS limit?
Ans. No, the LRS limit applies to individual transactions, not to the LLP. The remittance for the partner’s education is subject to the limit.
Q 22. Clarification on remittance by a sole proprietor under LRS?
Ans. A sole proprietor can remit funds under the LRS for permissible transactions such as business expenses, studies, medical treatment, etc., subject to the limit.
Q 23. Is prior approval required to open and maintain foreign currency accounts outside India for remittances under LRS?
Ans. No, prior approval is not needed to open foreign currency accounts outside India for LRS remittances, provided the conditions under the scheme are met.
Q 24. What are the facilities under Schedule III of FEMA (CAT) Amendment Rules, 2015 available for persons other than individuals?
Ans. Facilities for other persons such as firms or entities are available for specific permissible current account transactions under the LRS.
Q 25. Can a resident individual make a rupee loan to a NRI/PIO who is a close relative by cheque/electronic transfer?
Ans. Yes, a resident can make a rupee loan to an NRI/PIO, provided the loan is within the guidelines of FEMA.
Q 26. Can a resident individual make a rupee gift to a NRI/PIO who is a close relative by cheque/electronic transfer?
Ans. Yes, a resident can make a rupee gift to an NRI/PIO, provided it complies with the conditions set under FEMA.