Para 5.4 of AP DIR Circular 106 dated June 01, 2015 states that the applicants should have maintained the bank account with the bank for a minimum period of one year prior to the remittance for capital account transactions. Whether this restriction applies to current account transactions? - FEMA - FAQ - FEMA

Ans. No. The rationale is that remittance facility for current account transactions under Schedule III of FEM (CAT) Amendment Rules, 2015, such as private and business visits, up to the LRS limit of USD 250, 000 can also be provided by FFMCs. As FFMCs cannot maintain accounts of remitters, the proviso (as mentioned in para 5.4 of the circular ibid) has been confined to capital account transactions. However, FFMCs, are required to ensure that the Know Your Customer guidelines and the Anti-Money Laundering Rules in force have been complied with while allowing the current account transactions.