Internet & Web Services, Cards and PPIs
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Foreign Exchange Facilities for Individuals — Foreign Exchange Facilities for Individuals.
One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What category of scheme does the RBI treat a foreign website that promises residents earnings in foreign currency for adding more customers to a chain?
Such schemes are treated as money circulation type arrangements, and AD banks must not allow remittances to their operators.
Are Rule 5 restrictions of FEMA Current Account Transactions Rules 2000 applicable to International Credit Card use by residents while visiting abroad?
No, Rule 5 restrictions are not applicable to ICC use abroad.
When a resident approaches an AD bank to remit funds to an overseas operator of a chain-based earning scheme, what must the bank do?
The bank must refuse the remittance because chain/earn-in-forex website schemes are classified as money circulation type arrangements, which are prohibited.
Who fixes the credit limit for International Credit Card use on the internet when RBI prescribes no separate aggregate ceiling?
The credit limit is fixed by the card-issuing bank.
Why is the inflow of foreign exchange from a chain scheme irrelevant when an AD bank decides whether to permit a remittance to an overseas operator?
The prohibition applies to the outflow remittance itself; the fact that foreign exchange may flow in does not legitimise sending money to an operator of a prohibited money-circulation scheme.
Can an International Credit Card be used to import books and purchase downloadable software?
Yes, both are permitted uses of International Credit Cards.
Can a resident invoke the Liberalised Remittance Scheme limit to justify remitting money to an overseas chain-earning website operator?
No, LRS limits do not override the prohibition; a scheme classified as a money circulation arrangement remains prohibited regardless of the LRS ceiling.
Is purchasing lottery tickets or participating in sweepstakes a permitted use of an International Credit Card?
No, lottery tickets and sweepstakes are prohibited ICC uses.
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