Who is an Authorised Dealer
In the context of banking, an Authorised Dealer is a person authorised by the Reserve Bank of India to undertake any dealings in foreign exchange or foreign securities under the Foreign Exchange Management Act, 1999.
What are the various categories of Authorised Dealer
The various categories of Authorised Dealer Bank are as under:
- Category I: All the transactions permissible by the RBI can be undertaken. All public sector, private sector and foreign banks fall within this category.
- Category II: Only select non trade transactions can be undertaken. These transactions pertain to remittance of foreign exchange involving private visits, business travel, medical treatment abroad, overseas education, membership fees to international organisations. Co-operative banks and non-banking finance companies fall within this category.
- Category III: Only specific foreign exchange transactions incidental to their business/ activity can be undertaken. Clearing Corporation of India Limited and Export Import Bank of India fall within this category.
Can an Authorised Dealer appoint an agent
An Authorised Dealer Category I or Category II entity can appoint entities as a Franchisee for undertaking restricted money changing activities i.e. conversion of foreign currency notes, coins or travellers cheques to Indian Rupees.
The above article provides a general overview on the topic. For further information with respect to NRO accounts, kindly contact services@jneela.com.
