What changed
This Master Circular No.14/2011-12 consolidated all existing instructions on the Money Transfer Service Scheme into a single document. It was issued with a sunset clause of one year, meaning it would stand withdrawn on July 1, 2012, and be replaced by an updated version.
What it means for you
For banks and authorized persons acting as Indian Agents, this circular provides a unified reference for MTSS compliance, including KYC/AML/CFT guidelines. It reinforces that only inward personal remittances are permissible, and no outward remittances are allowed under the scheme. Agents must ensure tie-ups with reputed Overseas Principals and adhere to reporting requirements.
What you must do
- Ensure your entity is an Authorised Dealer Category-I, II, or Full Fledged Money Changer before applying as an Indian Agent.
- Submit applications to RBI's Forex Markets Division with audited financials, Overseas Principal details, and branch list.
- Comply with KYC/AML/CFT guidelines for all MTSS transactions and submit quarterly remittance statements.
- Verify that no outward remittances are processed under MTSS; only inward personal remittances are allowed.
Who it affects
Authorised Dealer Category-I banks, Authorised Dealer Category-II entities, Full Fledged Money Changers (FFMCs), Overseas Principals (money transfer companies), Sub-Agents appointed by Indian Agents
What types of remittances are allowed under MTSS?
Only inward personal remittances, such as family maintenance and remittances for foreign tourists visiting India. Outward remittances from India are not permitted.
Who can apply to become an Indian Agent under MTSS?
Only Authorised Dealer Category-I banks, Authorised Dealer Category-II entities, or Full Fledged Money Changers (FFMCs) can apply to RBI for permission.
What is the sunset clause mentioned in this circular?
The circular had a one-year sunset clause, meaning it would be withdrawn on July 1, 2012, and replaced by an updated Master Circular on the same subject.