jaiib free notes only at 08894024784 just sms your email id

jaiib free notes only at 08894024784 just sms your email id

 

 

 

Resident Foreign Currency Account (RFC)

A Resident Foreign Currency account in India can be maintained by a Non-resident Indian who has returned home for permanent settlement, after staying abroad for a minimum period of one year. An RFC account can be opened without any regulatory approval from the Reserve Bank of India.

RFC accounts can be maintained in USD/EUR/GBP/JPY/AUD/CAD in the form of Savings /Term Deposit

Credits to the account can in any of the following means:

(i) Balances standing to the credit of NRE and FCNR accounts at the time of return.

(ii) Income from overseas assets or sales proceeds from overseas assets.

(iii) Entire amount of pension received from abroad.

(iv) Balance in the account can be remitted abroad for bonafide purposes either for yourself or your dependants.

If you decide to go abroad again you can transfer your funds to NRE/FCNR account(s)
Interest earned on RFC account is subject to tax.

FCNR (B ) ACCOUNTS

• The Foreign Currency Non-Resident (FCNR (B)) scheme, introduced w.e.f.  15.05.1993. It covers deposits denominated in any “permitted Currency” which is freely convertible (w.e.f. 19.10.11) from non-resident individuals of Indian nationality or origin (NRIs).

• The deposits (term deposits) are being accepted by banks (AD) for fixed maturities as

under:-

a) 1 year and above but less than 2 years;

b) 2 years and above but less than 4 years;

c) 4 years and above but less than 5 years;

d) 5 years only

• Recurring Deposits are not being accepted under the Scheme

Repatriation of funds in foreign currencies is permitted. Transfer of funds from existing NRE accounts to FCNR(B) accounts and vice versa of the same account holder is permissible without prior approval of RBI.

Payment of Interest

• The present ceiling rate in respect of  FCNR(B) deposits for the respective currency / corresponding maturity is LIBOR/SWAP rate plus 200/300 basis points, as the case may be, effective from the close of business in India as on May 4, 2012. Bank should obtain prior approval of its Board of Directors for the interest rates that it will offer on deposits of various maturities within the ceiling prescribed by RBI.

• FEDAI quotes / displays the LIBOR / SWAP rates which should be used by banks in arriving at the rates of interest to be offered on FCNR (B) deposits. The rates are displayed in the FEDAI website.

• The interest on the deposits accepted under the scheme shall be paid on the basis of 360 days to a year.  The interest should be calculated and paid at intervals of 180 days each and thereafter for the remaining actual number of days. However, the depositor will have the option to receive the interest on maturity with compounding effect.

• Banks may at its discretion, allow additional interest at a rate not exceeding 1% p.a. over and above the rate of interest prescribed by the bank in respect of a deposit accepted in the name of bank’s staff member or a retired member of the bank's staff, either singly or jointly with any other member or members of his/her family, or the spouse of a deceased member or a deceased retired member of the bank's staff, subject to:

a) The depositor or all depositors of a joint account is/are non-resident/s of Indian nationality or origin;

b) The bank should obtain a declaration from the depositor concerned that the moneys so deposited or which may, from time to time, be deposited, shall be moneys belonging to the depositor,

c) The rate fixed by the bank for deposits of staff members, existing or retired, should not exceed the ceiling rate prescribed by RBI.

• Premature withdrawal, at the specific request of the depositor, is permitted under the Scheme. No interest is payable in case of premature within the minimum period of 1 year and bank may at its discretion levy penalty to cover the swap cost. In other cases, banks are free to charge penalty for such premature withdrawal at their discretion. Conversion of FCNR (B) deposits into NRE deposits or vice-versa before maturity should be subject to the penal provision relating to premature withdrawal.

• Banks may, at their discretion, renew an overdue deposit or a portion thereof and pay appropriate interest provided the overdue period from the date of maturity till the date of renewal (both days inclusive) does not exceed 14 days.

• In case the overdue period exceeds 14 days and the deposit or a portion of the deposit is being retained with the bank as a fresh deposit in the Scheme, banks may fix their own interest rates for the overdue period on the amount so placed as a fresh term deposit. Banks can recover the interest so paid for the overdue period if the deposit is withdrawn before completion of the minimum stipulated period under the scheme after renewal.

• In case of reinvestment deposits, banks should pay interest for the intervening Saturday/Sunday/holiday/non-business working day on the maturity value whereas In the case of ordinary term deposits, the interest for the intervening Saturday/Sunday/holiday/non-business working day should be paid on the original

In Brief: FEATURES OF VARIOUS DEPOSIT SCHEMES AVAILABLE TO NON-RESIDENT INDIANS (NRIs) AT A GLANCE Particulars Foreign Currency (Non-Resident) Account (Banks) Scheme (FCNR(B) Account) Non-Resident (External)Rupee Account Scheme (NRE Account) Non-Resident Ordinary Rupee Account Scheme (NRO Account) Who can open an account NRIs (individuals / entities of Bangladesh/ Pakistan Nationality/ownership require prior approval of RBI) NRIs (individuals / entities of Bangladesh / Pakistan nationality / ownership require prior approval of RBI) Any person resident outside India (other than a person resident in Nepal and Bhutan). (individuals / entities of Bangladesh / Pakistan nationality / ownership as well as erstwhile OCBs require prior approval of RBI). Joint account In the names of two or more non-resident individuals In the names of two or more non-resident individuals May be held jointly with residents Nomination Permitted Permitted Permitted Currency in which account is denominated Pound Sterling, US Dollar, Jap. Yen, Euro, Canadian Dollar and Australian Dollar.   Indian Rupees Indian Rupees Repatriability Repatriable Repatriable Not repatriable except for the following in the account – 1) Current income 2) Upto USD 1 Million per financial year (April- March), for any bonafide purpose out of the balances in NRO account / sale proceeds of assets in India acquired by way of inheritance / legacy inclusive of assets acquired out of settlement subject to certain conditions.   Type of Account Term Deposit only Savings, Current, Recurring, Fixed Deposit   Savings, Current, Recurring, Fixed Deposit Period for fixed deposits For terms not less than 1 year and not more than 5 years. At the discretion of the bank As applicable to resident accounts.     Rate of Interest : Subject to cap: LIBOR / SWAP rates for the respective currency / corresponding maturities (Plus 100 basis points as on date - Jan’09).  Subject to cap: Fixed Deposits: LIBOR / SWAP rates, as on the last working day of the previous month, for US dollar of corresponding maturities (plus 175 basis points as on date - Jan’09). Savings Bank Account Interest rate shall be at the rate applicable to domestic savings account with effect from close of business in India on 17-11-2005. Banks are free to determine interest rates for term deposits.                 Tax on Interest Income Not Taxable Not Taxable  TDS on Interest earned on NRO deposits     to be deducted at 30.90%    If the interest amount paid exceeds     Rs.10 lacs, TDS will be @ 33.99%    However, deduction of TDS is subject to    DTAA with many countries.       For further information pl. refer to  IBD     Circular letter no. 5920 dt. 29.05.08       Operations by Power of Attorney in favour of a resident by the non-resident account holder   Operations on the account in terms of Power of Attorney are restricted to withdrawals for permissible local payments or remittance to the account holder himself through normal banking channels. Loans : a. In India: i) to the Account holder ii) to Third Parties Permitted up to Rs.100 lakhs Permitted upto Rs.100 lakhs   Permitted up to Rs.100 lakhs Permitted up to Rs.100 lakhs Permitted Permitted     b. Abroad: i) to the Account holder ii) to Third Parties Permitted   USD equivalent to Rupees 100 lakhs   Permitted   USD equivalent to Rupees 100 lakhs   Permitted   USD equivalent to Rupees 100 lakhs Permitted   USD equivalent to Rupees 100 lakhs  Not Permitted Not Permitted     $   Provided no funds are remitted to India and are used only in abroad c. Foreign Currency Loans in India: i) to the Account holder ii) to Third Parties Permitted upto Rupees 100 lacs or its equivalent Not Permitted Not Permitted Not Permitted  Not Permitted  Not Permitted     Purpose of Loan: a. In India i) to the Account holder   i) Personal purposes or for carrying on business activities. * ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 9 of Sch. 2 to FEMA 5) i) Personal purposes or for carrying on business activities. * ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies   iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 6(a) of Sch.1 to FEMA 5) Personal requirement and / or business purpose * ii) to Third Party Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Pl. refer to para 9 of Sch. 2 to FEMA 5). Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Please refer to para 6(b) of Sch. 1 to FEMA 5)   Personal requirement and / or business purpose * b. Abroad : To the account holder and Third Party   Fund based and / or non-fund based facilities for bonafide purposes.   Fund based and / or non-fund based facilities for bonafide purposes.     Not permitted.       Interest on Loan against Deposits: Loan against NRO / NRE Deposits: Self                           :   2% ODR Third Parties            :  1% above BPLR Loan against FCNR Deposits (Rupee) : Self & Third Parties :  1% below BPLR Foreign Currency Loan : Only for Self             :  2% ODR or 2% over LIBOR whichever is higher. * The loans cannot be utilised for the purpose of re-lending or for carrying on agriculture or plantation activities or for investment in real estate business. Note:a. When a person resident in India leaves India for Nepal and Bhutan for taking up employment or for carrying on business or vocation or for any other purpose indicating his intention to stay in Nepal and Bhutan for an uncertain period, his existing account will continue as a resident account. Such account should not be designated as Non-resident (Ordinary) Rupee Account (NRO). b. Banks may open and maintain NRE / FCNR (B) Accounts of persons resident in Nepal and Bhutan who are citizens of India or of Indian origin, provided the funds for opening these accounts are remitted in free foreign exchange, Interest earned in NRE / FCNR (B) accounts can be remitted only in Indian rupees to NRIs and PIO resident in Nepal and Bhutan. c. In terms of Regulation 4(4) of the Notification No.FEMA.5/2000-RB dated May 3, 2000, Banks may open and maintain Rupee accounts for a person resident in Nepal / Bhutan. d.   The regulations relating to the various deposit schemes available to Non Resident Indians have been notified vide Notification no. FEMA.5 dated 03rd May, 2000, as amended from time to time. The relevant notification and A P (DIR Series) Circulars are available in RBI website www.rbi.org.in and may please be referred to for full details.

URC 522:- The ICC Uniform Rules for Collections are a practical set of Rules to aid bankers, buyers, and sellers in the collections process. The Rules have been prepared to resolve problems that practitioners have experienced in their everyday operations since 1979.

URC 522 underlines the need for the principal and/or the remitting bank to attach a separate document, the collection instruction, to every collection subject to the Rules - makes it very clear that banks will not examine documents, particularly not to look for instructions - addresses problems banks experience in respect of documents against acceptance (D/A) and documents against payment (D/P) - clearly indicates that banks have no obligation to store and insure goods when instructed.

jaiib free notes only at 08894024784 just sms your email id

Table of Contents

A. General Provisions and Definitions	Article
Application of URC 522	1
Definition of Collection	2
Parties to a Collection	3
B. Form and Structure of Collections
Collection Instructions	4
C. Form of Presentation
Presentation	5
Sight/Acceptance	6
Release of Commercial Documents
Documents Against Acceptance (D/A) vs
Documents Against Payment (D/P)	7
Creation of Documents	8
D. Liabilities and Responsibilties
Good Faith and Reasonable Care	9
Documents vs. Goods/Services/Performances	10
Disclaimer for Acts of an Instructed Party	11
Disclaimer on Documents Received	12
Disclaimer on Effectiveness of Documents	13
Disclaimer on Delays, Loss in Transit and Translation	14
Force Majure	15
E. Payment
Payment without Delay	16
Payment in Local Currency	17
Payment in Foreign Currency	18
Partial Payments	19
F. Interest, Charges and Expenses
Interest	20
Charges and Expenses	21
G. Other Provisions
Acceptance	22
Promissory Notes and Other Instruments	23
Protest	24
Case-of-Need	25
Advices	26