rbi

Copy Page

Published on 4 April 2025

Amendments to Foreign Exchange Management Regulations 2025 Explained

Overview of the Foreign Exchange Management (Manner of Receipt and Payment) (Amendment) Regulations, 2025

The Reserve Bank of India (RBI) has announced amendments to the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023. This update is documented in Notification No. FEMA 14(R)(1)/2025-RB, dated February 10, 2025. The amendments primarily focus on refining payment methods for Asian Clearing Union (ACU) member countries, excluding Nepal and Bhutan.

Key Changes

  • Routing Payments: Payments between residents of ACU member nations must now be processed via the ACU mechanism or as per the RBI directives to authorized dealers.
  • Alternative Transactions: For transactions outside the ACU framework, both receipts and payments must adhere to the guidelines outlined in subsequent regulations.

The amendments are issued under Section 47 of the Foreign Exchange Management Act, 1999 (FEMA), and they will take effect upon publication in the Official Gazette. These changes aim to improve the efficiency of cross-border transactions within the ACU while ensuring adherence to regulatory standards.

Foreign Exchange Management (Manner of Receipt and Payment) (Amendment) Regulations, 2025

In accordance with the power granted by Section 47 of the Foreign Exchange Management Act, 1999 (42 of 1999), the Reserve Bank hereby makes the following amendments to the Foreign Exchange Management (Manner of Receipt and Payment) Regulations, 2023 (Notification No. FEMA 14(R)/2023-RB dated December 20, 2023), referred to as 'the Principal Regulations':

  1. Title and Effective Date:

    • This regulation shall be referred to as the Foreign Exchange Management (Manner of Receipt and Payment) (Amendment) Regulations, 2025.
    • The regulations will be effective from the date of their publication in the Official Gazette.

  2. Amendment to Regulation 3:

    • In the Principal Regulations, Regulation 3, sub-regulation (2), clause (I), the second item (ii) along with its proviso is replaced with the following:
      • “(ii) Member countries of ACU, excluding Nepal and Bhutan – For payments from a resident of one participant country to a resident of another participant country, payments must be done through the ACU mechanism or according to directions issued by the Reserve Bank to authorized dealers. For all other transactions, receipts and payments should be conducted as specified in (iii) below.”
Share: