Foreign Exchange Management (Deposit) Regulations, 2000- Loans to Non Residents / third party against security of Non Resident (External) Rupee Accounts
[NR (E) RA / Foreign Currency Non Resident (Bank) Accounts [FCNR(B)] -Deposits
RBI/2008-09/462 A. P. (DIR Series) Circular No.66 dated 28th April 2009
The banks may now grant loans against NR(E)RA and FCNR(B) deposits either to the depositors or third parties up to a maximum limit of Rs.100 lakh (erstwhile Rs.20 lakhs). The banks are also advised not to undertake artificial slicing of the loan amount to circumvent the aforesaid ceiling.
To understand the erstwhile provision, kindly look into Para 6 (a), (b), (c) and (d) of Schedule 1 and Para 9 of Schedule 2 to Foreign Exchange Management (Deposit) Regulations, 2000 notified vide Notification No. FEMA 5 / 2000-RB dated May 3, 2000, as amended from time to time regarding loans against security of funds held in deposit accounts. Further, attention of the banks is also invited to A. P. (DIR Series) Circular No.29 dated January 31, 2007 prohibiting banks from granting fresh loans or renewing existing loans in excess of Rs.20 lakh against NR(E)RA and FCNR(B) deposits either to the depositors or third parties. The banks were also advised not to undertake artificial slicing of the loan amount to circumvent the ceiling.
0 comments:
Post a Comment