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JC - Legal Updates - New norms for cross border receipt and payment mechanism

Legal Updates

28 Dec 2023

New norms for cross border receipt and payment mechanism

Brief Overview:
RBI introduces the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023 (“Regulations”) specifying the payment and receipt mechanism for trade and non-trade related transactions. The Regulations will supersede the earlier regulations on the subject matter.
Technical Details:
The Regulations have specified the manner in which persons resident in India shall make or receive payment from a person resident outside India.
Key transaction channels and manner of remittance are provided below:

Transaction Channel

Receipt/payment to or from Nepal and Bhutan

Receipt/payment to or from member countries of Asian Clearing Union (“ACU”)

Receipt/payment to or from other countries

Trade Transactions (for export or import)

Indian Rupees*


Through ACU mechanism or as per RBI directions*

Indian Rupees or any foreign currency*

Non-Trade Transactions

Indian Rupees*

Please refer to the next column

Indian Rupees or any foreign currency*

For any current account transactions, between any person resident in India and a person resident outside India, who is on a visit to India, may be made only in Indian Rupees.

JC takeaway:
These Regulations specifically streamline the manner of payment and receipt for any current account transaction in India, other than a trade transaction, between any person resident in India and a person resident outside India, who is on a visit to India.
For further details, please see:  
For any queries/clarifications, please feel free to ping us and we will be happy to chat:

●   Mr. Saurabh Sharma (saurabh.sharma@jclex.com)
●   Ms. Rupul Jhanjee (rupul.jhanjee@jclex.com