Rupee Drawing Arrangement – Increase in trade related remittance limit

Reserve Bank of India, vide RBI/2013-14/516 A. P. (DIR Series) Circular No. 111 dt. March 13, 2014, has advised AD Category-I Banks that the “Permitted Transactions”  limit of trade transactions under the Rupee Drawing Arrangements (RDAs), is modified  from the existing Rs 2,00,000/- (Rupees Two Lakh only) per transaction to Rs 5,00,000/- (Rupees Five Lakh only) per transaction, with immediate effect.

The previous circular in this regard is Part (B) of Annex-I to the A.P. (DIR Series) Circular No. 28 [A. P. (FL/RL Series) Circular No. 02] dated February 6, 2008 on Memorandum of Instructions for Opening and Maintenance of Rupee/ Foreign Currency Vostro Accounts of Non-resident Exchange Houses, as amended from time to time.


Permitted Transactions


Drawing Arrangements with Exchange Houses are primarily designed to channel inward personal remittances. Under no circumstances, donations / contributions to charitable institutions should be routed through the Exchange Houses. The following is the list of permissible transactions under Drawing Arrangements with Exchange Houses.


The list of Permitted Transactions are us under:

1. Credit to Non-resident (External) Rupee accounts maintained by Non-resident Indians in Indian Rupees.

2. Payments to families of Non-resident Indians.

3. Payments in favour of Insurance companies, Mutual Funds and the Post Master for premia / investments.

4. Payments in favour of bankers for investments in shares, debentures.

5. Payment to Coop. Housing Societies, Govt. Housing Schemes or Estate Developers for acquisition of residential flats in India inindividual names subject to compliance of regulations thereof by the Non-resident Indians.


6. Payments of tuition/ boarding, examination fee etc. to schools, colleges and other educational institutions.

7. Payments to medical institutions and hospitals for medical treatment of NRIs / their dependents and nationals of Gulf Countries in India.

8. Payments to hotels by nationals of Gulf countries / NRIs for their stay.

9. Payments to travel agents for booking of passages of NRIs and their families residing in India towards their travel in India by domestic airlines / rail, etc.

10. Trade transactions up to Rs. 5 lakhs per transaction.


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