WHAT IS FULL-FLEDGED MONEY CHANGER
Full Fledged Money Changer is an entity authorized by the Reserve Bank of India to deal in foreign exchange and offer essential foreign exchange services under Section 10 of the Foreign Exchange Management Act, 1999. A FFMC is an entity who purchase foreign exchange from non-residents or residents of India and sell the same for private and business travel purposes to the people visiting abroad. An Authorized money changer may either be a restricted money changer or Full-Fledged money changer.
In India people are not authorized to carry out the business of money changer unless they own a valid money changer’s license issued by the RBI. Any sort of money changing business without a valid license is liable to be penalised under FEMA Act. FFMCs may also setup franchisees or branches to undertake business of foreign currency.
To get a FFMC license, one has to register a company registered under the Companies Act, 2013with a minimum Net Owned Funds (NOF) of Rupees 25 lakh for a Single branch FFMC and Rupees 50 lakh for a Multiple branch FFMC. The main objective of such company must reflect the business of money changing into its Memorandum of Association (MOA). Within 6 months of getting the FFMC License the company is required to start the business of money changer and inform it to RBI. The Directors of the Entity undergo a review process under the “Fit and Proper” criteria by the RBI.
Renewal of License of Full-Fledged Money Changer
To renew the license, an application must be made before 1 month from the date of expiry of license with supporting documents. Once the License is expired, application for restoration of money changer’s license shall not be accepted by RBI.
Register and Records maintained by FFMC
Form FLM-1-Daily Summary and Balance book of the Foreign currency notes/coins.
Form FLM-2-Daily Summary and Balance book of Travelers’ cheques.
Form FLM-3-Register of purchases of the foreign currencies from the public.
Form FLM-4-Register of purchases of the foreign currency notes/ coins from authorized dealers and authorized money changers.
Form FLM-5-Register of sales of foreign currency notes/ coins and foreign currency travellers’ cheques to the public.
Form FLM-6-Register of sales of the foreign currency notes/ coins to authorized dealers/ Full Fledged Money Changers/ overseas banks.
Form FLM-7-Register of travellers’ cheques surrendered to the authorized dealers/ authorized money changers/ exported.
FFMC License can be revoked by RBI on the following grounds:
If to revoke the license is in public interest.
If the FFMC has failed to comply with provisions of the Foreign Exchange Management Act, 1999.
The existing conditions of a money changer's license may be altered by Reserve Bank or new conditions can be imposed.