Banking News

Foreign Currency Accounts of Ship-manning and Crew management agencies

The shipping or airlines company incorporated outside India can open, hold and maintain non-interest bearing foreign currency account with AD category-I bank in India. The balance available in that type of foreign currency account can be used by Shipping or Airlines Company for the purpose of local expenses.

The AD banks who open such foreign currency accounts (which will be maintained during the validity period of the agreement) shall comply with following guidelines of RBI.

Credits to the accounts should be only from freight or passage collection in India or inward remittances from overseas principal through normal banking channels.

Debits to the account shall be only to local expenses towards management of ships/crew in the ordinary course of business.

Either fund based or non-fund based  Credit facility against the security of funds held in such account is not permitted.

The amount received in these accounts cannot be used for the purpose of EEFC facility.

The bank shall meet the prescribed reserve requirements for the opening of above type of accounts.

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