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Use of Credit Cards
A.P.
(DIR Series) Circular No. 53 dated 27th June 2002
Attention
of Authorised Dealers is invited to paragraph 3 of AP (DIR Series) Circular
No.19 dated October 30, 2000 clarifying that the term �currency�, inter alia,
includes Credit Cards, ATM Cards and Debit Cards etc. and all the rules,
regulations made and directions issued under the Foreign Exchange Management Act
apply to Credit Cards, ATM Cards, Debit Cards etc. also.
2.
It is clarified that: -
(i)
International Credit Cards can be used on internet for any purpose for
which exchange can be purchased from an authorised dealer in India, e.g. for
import of books, purchase of downloadable softwares or import of any other item
permissible under EXIM Policy.
(ii)
International Credit Cards cannot be used on internet or otherwise for
purchase of prohibited items, like lottery tickets, banned or proscribed
magazines, participation in sweepstakes, payment for call-back services etc.,
since no drawal of foreign exchange is permitted for such items/ activities.
(iii)
There is no aggregate monetary ceiling separately prescribed for use of
International Credit Cards through Internet.
It is further clarified that Debit Cards and
ATM Cards can also be used for any purpose for which foreign exchange can be
purchased from an authorised dealer in India.
3.
Attention of authorised dealers is also invited to item (iii) of
Regulation 4 of the Reserve Bank Notification No.14/2000-RB dated 3rd May 2000
in terms of which payment received in rupees from credit card servicing banks in
India against the charge slip signed by the buyer is a permissible method for
receipt of payment for exports made out of India. This permission presumes that
the importer client had decided to make payment when he was on a visit to India.
It has now been decided to permit authorised dealers to accept payment by debit
to credit card for exports made out of India irrespective of whether the
importer client is on a visit to India or not. Accordingly, it is clarified that
authorised dealers may receive payment for exports made out of India by debit to
the credit card of an importer, where the reimbursement from the card issuing
bank/organisation will be received in foreign exchange.
4.
Authorised Dealers may bring the contents of this circular to the notice
of their constituents concerned.
5.
The directions contained in this circular have been issued under Section
10(4) and Section 11(1) of the Foreign Exchange Management Act, 1999 (42 of
1999).
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