RBI/2019-20/102 A.P. (DIR Series) Circular No. 09
November 22, 2019
To All Category-I Authorised Dealer Banks
Madam / Sir
Non-resident Rupee Accounts – Review of Policy
Attention of Authorized Dealer Category-I (AD Category-I) banks is invited to
paragraph 3 of Statement on Developmental and Regulatory Policies of the Fourth
Bi-Monthly Monetary Policy Statement for 2019-20 dated October 04, 2019.
2. In terms of paragraph 7 of Part II of Master Direction No.14 dated January
01, 2016 on “Deposits and Accounts”, as amended from time to time, any person
resident outside India, having a business interest in India, may open a Special
Non-Resident Rupee Account (SNRR account) with an authorised dealer for the
purpose of putting through bona fide transactions in rupees.
3. With a
view to promote the usage of INR products by persons resident outside India, it
has been decided, in consultation with the Government of India, to expand the
scope of SNRR Account by permitting person resident outside India to open such
account for:
External Commercial Borrowings in INR;
Trade Credits
in INR;
Trade (Export/ Import) Invoicing in INR; and
Business
related transactions outside International Financial Service Centre (IFSC) by
IFSC units at GIFT city like administrative expenses in INR outside IFSC, INR
amount from sale of scrap, government incentives in INR, etc. The account will
be maintained with bank in India (outside IFSC).
4. It has also been
decided, in consultation with the Government of India, to rationalise certain
other provisions for operation of the SNRR Account, as under:
Remove the
restriction on the tenure of the SNRR account opened for the purposes given at
paragraph 3 above as the proposed transactions are more enduring in nature.
Apart from Non-Resident Ordinary (NRO) Account, permit credit of amount due/
payable to non-resident nominee from account of a deceased account holder to
Non-Resident External (NRE) Account or direct remittance outside India through
normal banking channels.
5. All other provisions of the policy on
Deposits and Accounts remain unchanged. AD Category - I banks should bring the
contents of this circular to the notice of their constituents and customers.
6. The aforesaid Master Direction No. 14 dated January 01, 2016 is being
updated to reflect the changes.
7. The directions contained in this
circular have been issued under section 10(4) and 11(2) of the Foreign Exchange
Management Act, 1999 (42 of 1999) and are without prejudice to permissions /
approvals, if any, required under any other law.
Yours faithfully
(Sharmila Thakur) General Manager
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