License in India is mandatory for certain entities to deal with foreign
exchange or foreign securities. The responsibility to regulate FFMC License
lies on the shoulders of Reserve Bank of India.
to section 10 of the Foreign Exchange Management Act, 1999, authorized money
changers are the only type of organizations engaged in money changing services
and offer significant foreign exchange services.
License Holders purchase foreign exchange from Indian residents and
non-residents and sell that foreign exchange to foreign visitors or tourists
for private and business visits purposes.
foreign visitors as well as travelers, along with the specific firms, get the
registration to overcome the hindrances and also it will help them in the
direction of traveler's cheques, coins, and foreign currency notes as per the
getting a money changer's license from the RBI end, no person has got the right
to proceed or advertise that they deal in money changing activities. If there
will be a person's involvement in any form of money changing business without a
licit FFMC license in India, that person will amount to heavy penalties as per
are the following types of AMCs:
we are talking about those relevant documents that will get submitted to obtain
the online FFMC License in India
those corporations are entitled to get an FFMC License in India who complies
with the Requisites of Licensing. According to the Reserve Bank of India, the
procedure to acquire FFMC License in India is explained step by step
getting the License, Full Fledged Money Changers fulfills the following requirements
company should make an application for the Full Fledged Money Changers License
Renewal one month prior to the License expiry date. After the expiry of the
License, Application for renewal of a Money Changers License is of no use as no
restoration can take place.
connection with its money-changing transactions, FFMC must maintain the
following registers of activities
Balance Book and Details Of
currency notes/coins in Form FLM 1
FLM 2 stores Travelers' cheques
When can the Reserve Bank of India
utilize its Rights to revoke the License given to any FFMC?
RBI has the power and right to revoke FFMC License in India, RBI can go for
canceling if it is convinced that
is in public benefit
FFMC has failed to act in accordance with the provisions of Foreign Exchange
Management Act, 1999
A Brief Take on Franchisees
has authorized one more intermediary to trade in foreign exchange, i.e., Agents
and Franchisees. To deal with money changing actions, Authorized Dealer
Category- 1 Bank, Authorized Dealer Category- 2, and FFMC's can make the
appointment for their Agents as well as Franchisees. Following are the key
points related to this
Authorized Dealer Category- 1
Category- 2, All the banks and
Bank of India has allowed FFMCs to put their feet in Franchise Agreements for
meeting the objective of commencing the business of money changing. If any
person intends to opt for Franchisee of any AMC, that person needs to enter
into Franchise agreement before doing so.
Concerning This, the Following Salient Points Are
entity with a place of business can be a Franchise.
entity needs to have a minimum net owned fund of Rs 10 Lakh.
can carry out only those businesses that are related to restricted money
Franchisee Agreement must get agreed out between the parties.
Franchisees must reveal their Franchisers names, exchange rate, and they have
got the go-ahead signal regarding the purchase of foreign currency prominently
in their offices.
franchise will be surrendering the foreign currency that it has purchased only
to its franchiser within the duration of 7 working days, counting will start
from the date of purchase.
the responsibility of the Franchise to track and manage the existing proper
Fledged Money Changer is capable of providing sales facilities for foreign
asked for purchases of coins, foreign currency notes, and Travelers' cheques
from residents and also from non-residents, FFMC is likely to issue a
certificate of encashment.
in and taking out of the foreign exchange is possible through the support of
· FFMC may pull off those transactions that are concerned with Travelers' cheques, coins, and foreign currency notes at rates of exchange in alignment with the rates prevailing in the market.
Q. Who is allowed to be a
full-fledged money changer?
other than the bank could be a Full Fledged Money Changer.
Q. Whether the FFMC License
need to renew yearly?
the permit must be renewed each year by giving the application documents to the
Reserve Bank of India.
Q. Where an application will be
filed for FFMC License?
the FFMC License, the application is filed along with the required documents
with the foreign exchange department of the Reserve Bank of India where the
registered office of the corporation is situated.
Q. Is there any possibility of
carrying out money changing Business without the License of FFMC?
there is zero possibility to work as a money changer without getting the FFMC
Q. Apart from getting FFMC
License Approval, what are the other registrations required?
all these copies to the Regional Office of RBI before commencing business
copy of lease agreement
copy of registration under shops
receipt or Establishment Act
information visit www.taxaj.com
Posted by Pooja