If you want to become a money changer in India, then FFMC License is a must. Required as per the section 10 of the Foreign Exchange Management Act, 1999, this license will turn you into an Authorised Money Changer.
However, before you can get the license, you have to understand its guidelines
Guidelines that define the meaning of money changer
An AMC or Authorized money Changer is a business entity that has access to a wide array of foreign exchange facilities – giving it the ability to provide money changing services to foreign and domestic clients.
In order to become an authorized money changer, you need to file for this license online.
But before you do so, you must also know the guidelines pertaining to issuing the license.
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Guidelines of RBI to issue FFMC license in India
You need to fulfil the following conditions before you can apply for the license:
- You should have a company incorporated as per the Companies Act, and the object of that company must be to provide this license services in India.
- Your net owned fund should be the following:
- For a single branch of authorized money changing business: INR 25 Lakh
- For multiple branches of the said business: INR 50 Lakh.
How would you define net owned fund?
Net owned fund is calculated by subtracting the number of investments you’ve made in shares and subsidiaries from the owned funds.
Guidelines pertaining to the documents required for the FFMC license
As per the RBI guidelines, following documents are required for FFMC license:
- Certificate of incorporation of the company
- Certificate of business commencement of the company
- Memorandum of Association
- Articles of Association
- Copy of the latest audited certificate of net owned funds
- Copies of the latest audited balance sheet
- Banker’s confidential report
- KYC details of the directors
- Copy of the board resolution (certified)
Guidelines that form the basis of issuance of FFMC license
You must follow the following guidelines so that the RBI issues you the FFMC license:
- Comply with all this license requirements.
- As a director and your co-directors must meet the Fit and Proper Criteria
- Must first get your application cleared from an empowered committee
- You must accept the final decision of the RBI. If the RBI bars you from applying for FFMC license, then there is nothing you’d be able to do about it.
- Along with the application and the documents for this license, you might be required to submit the Shops and Establishment Act Certificate depending upon the state your FFMC is located in.
- You must start doing your business within 6 months after obtaining the FFMC license.
Conclusion
The RBI guidelines for authorized money changers are not about the FFMC license fees. They are about the terms on which the license is issues, the conditions that you have to abide by and the rules you need to follow to maintain your business. Read More Useful Content: Trusted Telecom Approval
Once the license is issue, remember that after five years of that, you’d need to go through FFMC license renewal as well, for the license isn’t perpetual, and you always need to comply to RBI laws.
What are the RBI guidelines for FFMC license? This license is issue as per the rules of Reserve bank of India. This blog sheds a light on those rules. Contact Registrationwala for more info.