FFMC License | RBI Full Fledged Money Changer Licence Online
Anyone who wishes to transact in foreign currencies must first get an FFMC licence from the Apex Bank or RBI. The holders of such a licence are permitted to buy foreign currency from NRIs (Non-Resident Indians) and sell it to Indian tourists travelling overseas for business.
It should be mentioned that only an AMC (Authorised Money Changer) is qualified to deal in the activities related to money changing and foreign exchange in accordance with the provisions and requirements of Section 10 of the FEMA 1999.
The RBI has also granted some businesses and hotels a Full Fledged Money Changer Licence to conduct business with foreign currency, traveller's checks, and coins. The same is done to minimise the challenges encountered by visitors and tourists from other countries.
Role of Authorised Money Changers in Forex Transactions
An important part of transactions involving foreign exchange is played by authorised money changers. The Reserve Bank of India(RBI) authorises banks to engage in foreign exchange trading by issuing licences to those institutions. Only banks that are prepared to conduct foreign exchange transactions in India are given the aforementioned licence.
Also to be highlighted is the fact that, in addition to banks, a few other financial entities have been permitted by the central bank to conduct specific kinds of foreign exchange operations that are unrelated to their primary activity.
Benefits of FFMC License
The key benefits of the Full Fledged Money Changer License are as follows:
Different Kinds of Full Fledged Money Changer License
The different kinds of Full Fledged Money Changer Licenses are as follows:
Conditions for Applying for Money Changer License in India
The following requirements must be met to apply for a money changer licence in India:
Regulatory Framework for Authorised Money Changer License
Authorised Money Changer Licences may only be issued by the Reserve Bank of India. Additionally, the Apex Bank may establish the following norms and directions for subjects related to AMC Licence:
What are the RBI Permitted FFMC Activities?
Following are the FFMC Activities that the RBI has approved:
The following uses permit the sale of foreign currency by an FFMC:
Necessary Papers Required for Applying for FFMC License
The following are the necessary papers needed to apply for an FFMC licence:
Procedure for Obtaining Full Fledged Money Changer License from RBI
The following steps are required to complete the RBI application process for a full-fledged money changer licence:
In addition, one of the key purposes of the Fit and Proper Criteria is to provide assistance in assessing the knowledge, moral character, credentials, and prior record of the candidate for the position of Director.
Key Requirements of the Fit and Proper Criteria
The Fit and Proper Criteria's main requirements can be summed up as follows:
Obtain Authorised Committee Authorization
The directors of the applicant company must get approval from the EC (Empowered Committee) in order to move on to the next phase of the process to obtain an AMC Licence. It should be mentioned, however, that the same will only be dependent on sufficient verification.
Verification by the Reserve Bank of India - Now, the application and supporting materials will be examined by the Reserve Bank of India. If the RBI is satisfied that the application and supporting paper works successfully meet the fit and suitable standards, it will grant the applicant an Authorised Money Changer or FFMC Licence within two to three months.
Starting up business operations - Following the receipt of a Full Fledged Money Changer licence, the business entity is required to launch its commercial operations within six months of the license's issue.
Before beginning business activities, the aforementioned firm must also submit a duplicate copy of the Possession Certificate, Shop and Establishment Licence, and Lease Agreement to the Reserve Bank of India.
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What are the FFMC Licence Post Approval Requirements?
The following are the post-approval registration requirements for a full-fledged money changer licence:
Franchise Owners' Concept
Multiple intermediaries who have been granted permission by the RBI to immerse in foreign exchange activities are referred to as agents or franchisees.
Additionally, Authorised Dealer Category-I Banks, Authorised Dealer Category-II Banks, and FFMCs may designate their Agents and Franchisees to carry out the activities related to money changing.
The following are some important points to keep in mind in this regard:
Revocation of Authorised Money Changer License
The Reserve Bank of India has the ultimate authority in India to revoke, suspend, or cancel an authorised money changer licence that has been issued. The following circumstances have the same possibility:
It should also be mentioned that Apex Bank retains the authority to modify, alter, or repeal any of the currently in effect terms, conditions, or rules pertaining to AMC Licence in India.
The procedure for renewing an Indian FFMC licence
The applicant must be a business with a registered office in the territory under the control of the relevant regional office of the Foreign Exchange Department and be registered under the Companies Act, 1956/2013, or the Registration of Companies (Sikkim) Act, 1961.
Renewal applications must be submitted with the below-mentioned necessary papers:
Different Records and Registers are to be maintained by the FFMC licence Holder
An authorised money changer is required to keep the following Registers and Records concerning their money-changing transactions:
Daily Summary and Balance Sheet
The following should be included in the daily summary and balance book:
The following must be made in the data register:
Submission of Balance Sheet and Maintenance of NOF
All FFMCs/non-bank ADs Category-II are demanded to submit their annual audited balance sheet to the relevant Regional office of the Reserve Bank in order to verify their Net Owned Funds. They must also include a certificate from the statutory auditors regarding the NOF as of the balance sheet's date. As FFMCs/non-bank ADs Category-II are expected to maintain the minimum NOF on an ongoing basis, they must notify the Reserve Bank right away of any erosion in their NOF below the minimum level and provide a detailed, time-bound plan for bringing their Net Owned Funds back up to the minimum required level.
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Frequently Asked Questions
Approved entities that comply with section 10 of the Foreign Exchange Management Act, 1999, and have received permission from the Reserve Bank of India to engage in foreign exchange business.
The main goal of FFMC's business strategy is to guarantee that, despite the competitive environment, consumers will receive the most efficient and superior services available. Additionally, the FFMC works to extend the availability of foreign exchange services to visitors to India, including NRIs.
The company requesting an FFMC Licence must first and foremost register with the Companies Registrar in accordance with the 2013 Companies Act. The entity's primary operation should be Forex currency trading, according to the object clause. In addition, the business should make sure that there are no current legal matters or Revenue Intelligence or the Department of Enforcement proceedings involving the corporation.
Yes, the RBI must receive the application materials each year in order to renew the FFMC Licence.
No, there is absolutely no chance that you might function as a money changer without obtaining an FFMC Licence.
Application in the prescribed form and the necessary paper works must be submitted to the relevant Regional Office of the Foreign Exchange Department of the RBI, in accordance with Section 10(1) of the FEMA, 1999.
The three FFMC Licence types are:
Authorised Dealer Category 1 Banks
Authorised Dealer Category 2
FFMC, or Full Fledged Money Changer
No, according to the RBI's master circular, franchisees are only permitted to engage in a limited number of money-changing operations.
Before starting the business, deliver all of these copies to the regional office of
A copy of the lease Agreement.
A copy of the shop registration
Establishment Act or Rental Receipt
Prepaid Cards for Forex
The acronym FFMC stands for a full-fledged money changer. A company will be classified as Full Fledged Money Changers (FFMC) if it plans to engage in foreign exchange business after receiving the Reserve Bank of India's prior approval.
25 lakhs for a single branch licence application and Rs. 50 lakhs for a multiple-branch licence application. The action of money changing that will be conducted through the corporation must be reflected in the object clause of the Memorandum.
The licence for a Full-Fledged Money Changer (FFMC) is only valid for a year. As a result, the licence holder must start the FFMC Licence Renewal Process two months before the licence expires. No new FFMC Licence Renewal Process applications may be submitted once the licence has expired or after a year.
The amount of foreign currency that one is supposed to bring to India is unrestricted that is not limited. However, if the sum mentioned exceeds a specific threshold, you must specify or make a note of it.