FFMC Compliance

A Full Fledged Money Changer (FFMC) is a recognised organisation that is permitted to buy foreign currency from both Indian citizens and non-residents and sell it to travellers only for personal or professional use. The only organisations in the nation with the authority to deal in money changing transactions and provide essential foreign exchange services are authorised money changers, as stipulated by Section 10 of the Foreign Exchange Management Act, 1999. Certain businesses and lodging facilities have also been given the opportunity to register to deal in foreign currency notes, coins, and traveller’s checks under the regular directives issued by the RBI in an effort to reduce the challenges encountered by international visitors and tourists.

Without a current money changer's licence from the RBI, no one is allowed to operate a money changing company or to advertise that they do. According to the Act, anybody caught conducting any kind of money-changing operation without a current licence faces penalties.

Role of (FFMC) Full Fledged Money Changer

Obtaining an FFMC licence from the Apex Bank or RBI is a must for anybody wishing to conduct foreign exchange transactions. Such licence holders are allowed to purchase foreign currency from non-resident Indians (NRIs) and resell it to Indian visitors going abroad on business.

It should be noted that, in compliance with the rules and specifications of Section 10 of the FEMA 1999, only an AMC (Authorised Money Changer) is qualified to deal in the operations relating to money changing and foreign exchange.

In order to conduct business with foreign cash, traveler's checks, and coins, the RBI has also issued full money changer licenses to a number of establishments, including hotels. The same is carried out to lessen the difficulties faced by guests and travellers from different countries.

Major Activities of (FFMC) Full Fledged Money Changer

The activities that Full Fledged Money Changer (FFMC) engages in are listed below.

• For the purpose of operating the Restricted Money Changing business, which essentially entails converting foreign currency notes, coins, or travellers' checks into Indian Rupees (INR), an FFMC may, at any time, engage into a franchise agreement.
• Both Indian citizens and foreign nationals may freely acquire foreign currency notes, coins, and traveler's checks from an FFMC or its franchisees.
• When selling Indian Rupees (INR) to foreign visitors or tourists using international credit cards or debit cards, an FFMC must move quickly to ensure that refunds are made through regular banking channels.
• The following are some reasons why FFMCs could decide to sell foreign currency.

1. Visits for Business
2. Private visits
3. Forex Pre-Paid Cards

Conditions for Applying for Money Changer FFMC License in India

Conditions for Applying for Money Changer License in India:

• You shall have to be an applicant for obtaining a license of a money changer in India on grounds of satisfying the following conditions:
• The company to be granted an FFMC license, should be properly incorporated under the provisions of the Companies Act of 2013.
• A single branch operation needs a minimum of at least Rs 25,00,000 in Net Owned Funds or NOF.
• Minimum NOF for operating various branches shall be Rs 50,00,000.
• The object clause of the Memorandum of Association must include money-changing operations; the firm must commence operations within six months from the date of receipt of an AMC License from RBI.
• The business must not have any pending issues with the Department of Enforcement or Revenue Intelligence;

Post Approval of Requirements by FFMCS

After receiving a licence to operate as such, the Full Fledged Money Changer (FFMC) must maintain the following requirements.

• Before any commercial activity begins, a copy of the registration under the Shops and Establishment Act and any other documentation proof, including a copy of the leasing agreement or a rent receipt, must be presented to the Regional Office at the Reserve Bank's request.
• New Full Fledged Money Changers (FFMC) are required to conduct their business in accordance with the guidelines often provided by the Reserve Bank.
• FFMCs are required to have a copy of the RBI-issued money-changing licence on display at each of their business locations.
• All of the transactions that FFMCs execute must be subject to a concurrent audit system.
• All FFMCs must provide their yearly audited balance sheets to the appropriate RBI Regional Office.

The regular maintenance of records, logbooks and other registers to keep the in details records of money exchange, traveller’s cheque and so on. Same has to be as per given prescribed format of RBI, Foreign Exchange Management.

On top of that, the license is generally valid for 1 year and required to renew fulfilling the compliance on time. In order to revive the year end validity license of full fledge money changer undoubtedly the license holder need to do business of money changing with proper details and records thereon. 

By the year end, the license holder is required to submit audited financial statement, ITR, Auditor report, net worth certificate and other ancillary documents to survive the licensing criteria which is always year on year basis.

The following are the main advantages of having a full-fledged money changer Compliance License:

• An AMC licence holder is able to provide foreign exchange services and selling facilities.
• An FFMC license holder is able to issue encashment certificates for foreign currency notes and travellers' cheques from both residents and non-residents;
• An FFMC licence holder is permitted to handle foreign currency transactions for foreign guests visiting India;
• Transactions involving coins, travellers' cheques, and foreign currency at the going rate of exchange may be handled by holders of AMC licenses;

The eligibility criteria necessary to operate as a Full Fledged Money Changer are given below.

• The Entity applying for a license as a Full Fledged Money Changer shall be registered under the Companies Act of 2013.
• Net-owned fund for a single-branch license shall be a minimum of INR 25 Lakhs, and for a multiple-branch license, INR 50 Lakhs.
• The object clause of the Memorandum is required to reflect an activity of money changing to be undertaken by the Entity.
• There must not be pending civil or criminal cases against the Entity with the enforcement of the Department of Revenue Intelligence.
• The Entity, after obtaining the FFMC License, shall undertake its business activity within a period of 6 months from the date of issue of the Forex License and shall, in any case, intimate the same to the RBI without fail.

The paperwork required to submit an application for an FFMC Compliance is as follows:

• A copy of the certificate of incorporation, or COI;
• A copy of the Memorandum of Association (MOA), which has the relevant sections regarding how the money-changing firm is run;
• A copy of the Articles of Association (AOA), which include the relevant sections concerning the management of the money-changing enterprise;
• A duplicate of the latest audited financial statements and the certificates from the statutory auditors confirming the NOF on the application date;
• A copy of the latest balance statement that was audited;
• A duplicate of the preceding three years' profit and loss statements;
• A bank report that the applicant has requested to be kept private; details about every sister or related business that is involved in the financial industry, including NBFCs;
• A copy of the board resolution that was approved to run the officially certified money-changing business.

The Reserve Bank of India oversees the FFMC License application procedure.

• A thorough and comprehensive application for the FFMC License is sent to the Reserve Bank of India regional office in question.
• The RBI would evaluate the application Entity's director in accordance with the "fit and proper" standards. In a span of two to three months, the RBI will provide the Full Fledged Money Changer (FFMC) License if all the requirements are met.
• The Empowered Committee's clearance is required, and the Reserve Bank's decision to approve or disapprove would be final and enforceable.

Note: If any case has been filed or is pending against the Entity or any of its Directors by any law-enforcing agencies, the Entity will not be deemed eligible to receive an FFMC License.

A Full Fledged Money Changer (FFMC) license renewal application must be submitted no later than one month after the license's expiration date. After the FFMC licence expires, no request for the restoration of a money changer's licence will be granted.

Corpseed will help you obtain the Full-Fledged Money Changer License. Our team will, with the aid and assistance of our highly qualified staff, assist in obtaining the license and take your business to the next level. You can use our expertise and experience in having an easy and efficient system of payment processing.

Also, we clearly document the estimates of expenses, documents, and requirements of the whole procedure in advance for transparency.

Share Your Documents: Our team assures easy paper works. For a time effective filing and delivery, we collect the necessary paper works and distribute the relevant drafts.

Analysis and Update: We do not waste any time in preparing and filing your application once the required paper work is gathered. You are updated and made aware that your application is in process.