Foreign exchange regulation act Foreign Exchange, since time | https://t.me/Banking_IBPS_PO_SBI_Clerk_exam
Foreign exchange regulation act
Foreign Exchange, since time immemorial, has been recognised as the exclusive domain for banks and corporations at large. To add to it, it is also the world’s biggest market so far. Keeping in mind the augmenting importance of this market where currency gyrations can dictate the fortunes of one and all, it was considered of paramount importance, to bring foreign exchange under the ambit of regulation.
FERA – the four-letter acronym for Foreign Exchange Regulation Act is a legislation that came into existence in 1973 with the purpose to regulate certain dealings in foreign exchange, impose restrictions on certain kinds of payments and to monitor the transactions impinging the foreign exchange and the import and export of currency.
Features of FERA:
Applicable to all the citizens of India, the intent of FERA, inter alia, was to conserve the foreign exchange resources of the nation. Some of the key features of the act are as follows:
Authorisation by RBI to any person/company to deal in foreign exchange
Authorisation to the dealers by the Reserve Bank of India for transacting foreign currencies, subject to review and revocation of the authorisation in the case of non-compliance
Authorisation to the money changers for conversion of currencies as per the rates determined by RBI
Restrictions on import/export of currencies
Restriction on persons other than the authorised dealers to enter into transactions involving the financial currency
Restrictions on issue of bearer securities
Restrictions on holding or acquiring immovable properties outside India
Restrictions on making/receiving payment to/from a resident outside India
The Power of RBI to call for information and seize documents, wherever or whenever required.
