JAIIB · PPB

Foreign Currency Accounts of Residents

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What is a Resident Foreign Currency (RFC) account?

An RFC account is a foreign currency account maintained by a resident Indian (who was previously a non-resident) to hold foreign currency assets brought back to India upon return.

What is the maximum amount of foreign currency that can be held in an RFC(D) account?

No upper limit is prescribed for RFC(D) account balances.

Who is eligible to open an RFC account in India?

A person who was a Non-Resident Indian (NRI) and has returned to India for permanent settlement (i.e., become a resident) is eligible to open an RFC account.

Can proceeds from foreign currency travellers' cheques be credited to an RFC(D) account?

Yes, unspent foreign currency travellers' cheques can be credited to RFC(D).

In which currencies can an RFC account be maintained?

RFC accounts can be maintained in any freely convertible foreign currency such as USD, GBP, EUR, JPY, etc., as permitted by the authorised dealer bank.

Under FEMA, which authority regulates foreign currency accounts of Indian residents?

Reserve Bank of India (RBI) regulates these accounts under FEMA 1999.

What are the permissible credits to an RFC account?

Credits permitted include proceeds of assets held abroad, foreign currency brought into India on return, earnings from employment or business outside India, and interest earned on the RFC account itself.

Can an RFC account be converted into an NRE account if the resident becomes non-resident again?

Yes, RFC account can be re-designated as NRE account on re-acquiring NRI status.

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