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Authorized Money Changer License

Authorized Money changer-compliance-corpseed.jpeg

Money Changer

As per Section 10 of the Foreign Exchange Management Act 1999, Authorised Money Changers/ AMCs are entities who are authorized by the Reserve Bank of India (RBI) for the exchange of the currencies for private visits, business trips or as forex pre-paid cards.

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Accordingly, an AMC can be –

  • Restricted Money Changer (RMC)  - authorised only to purchase foreign exchange from residents and non-residents
  • Full Fledged Money Changer (FFMC) - authorized to purchase and sell foreign exchange from residents and non-residents visiting India

There are three different types of AMCs:

  • Authorized Dealer Category – I Banks ( AD Category – I Banks)
  • Authorized Dealer Category – II (AD Category – II), and
  • Full Fledged Money Changers also called as FFMCs. 

Who are Full-Fledged Money Changers (FFMCs)?

FFMCs are the companies aiming to carry out the activities of forex currency exchange, only after obtaining the prior approval/ license from the Reserve Bank of India.

According to the FEMA Act, FFMC License holders can purchase foreign exchange from non-residents and residents of India and sell that foreign exchange for private and business travel purposes only to the people visiting abroad.

Eligibility Criteria –

  • Applicant has to be a Company Registered under company’s act 2013
  • Minimum Net Owned funds required for consideration as FFMC –
  1. Single Branch – Rs 25 lac
  2. Multiple branched – Rs 50 lac
  • The object clause of MOA must include the activity of money changing.
  • No pending civil/criminal case should be there against the Company with the Department of Enforcement of Department of Revenue Intelligence.
  • The FFMC Company should carry out its business activity within six months from the date of issuance of FFMC License and should intimate RBI.

Activities that FFMCs can carry -

  • Can into franchise agreement at for the Restricted Money Changing business
  • They are allowed to sell Indian Rupees to foreign visitors or tourists against International Credit Cards/International Debit Cards
  • FFMCs or their franchises can purchase/ buy coins or traveler's cheques and foreign currency notes from both NRIs as well as residents of India.
  • An FFMC is allowed to opt for selling foreign exchange for the following purposes only:
  1. Private Visits
  2. Business Visits
  3. Forex Pre-Paid Cards.

Documents required for obtaining an FFMC License -

  • Certificate of Incorporation of the Company.
  • The MoA (Memorandum of Association) and AoA (Articles of Association) of the company containing/ amended with the objective for carrying out money changing activities
  • Copy of the Board Resolution for carrying out the business of money ex-changing
  • Consecutive three year audited balance sheet along with the Profit & Loss statement of the entity as well as the individual.
  • A declaration mentioning that there aren’t any proceedings pending or initiated by the Directorate of Revenue Intelligence (DRI) or Directorate of Enforcement (DoE) or any other law administering authorities.
  • A sealed confidential report from the banker.
  • A declaration to the effect that proper policy framework on KYC/AML (Anti-Money Laundering) / CFT (Combating the Financing of Terrorism) will be kept in place on procuring the authorization from the Reserve Bank of India and before commencing the business operations.

Procedure for acquiring FFMC Registration from RBI

  • Step 1: Submit the application to RBI-
    A detailed application for the FFMC registration to the concerned regional office of the RBI is submitted along with the above mentioned documents.
  • Step 2: The applicant should fulfil the fit and proper criteria -
    There shouldn’t be any proceedings pending with the DRI or DoE. If there’s any proceeding pending, the applicant won’t be considered for the grant of FFMC license.
  • Step 3: Directors profile will be reviewed by the RBI.
  • Step 4: Once the RBI is satisfied by the documents, it will issuance of the Certificate of Registration within the time frame of two to three months.

Renewal of FFMC License -

  • An application for the renewal of a FFMC license must be made before a month of its expiry.
  • No Application for renewal of a Money Changer's License will be entertained by RBI after its expiry.

The Post-Approval Requirements of FFMCs

  • Once the FFMC license is obtained the applicant is required to submit a copy of registration obtained under Shops & Establishment Act to the RBI’s regional office.
  • It's a compulsion for a FFMC to display a copy of the money changing license or FFMC license.
  • FFMCs have to keep a record of concurrent audit of the transactions they undertake.
  • Every FFMC needs to submit its Annual Audited Balance Sheet and have to fulfil all the compliances.

Forms and the Compliances required by a FFMC to be filled with RBI-

A FFMC Has to full fill both –

  • MCA compliances – based on whether a registred entity is private limited or a public limited
  • RBI compliances – this included some forms namely –
  1. FLM 1 - Daily Summary and Balance Book (Foreign currency notes/coins)
  2. FLM 2 - Daily Summary and Balance Book (Travellers' cheques)
  3. FLM 3 - Register of purchases of foreign currencies from the public
  4. FLM 4 - Register of purchases of foreign currency notes/coins from authorized dealers and authorized money changers
  5. FLM 5 - Register of sales of foreign currency notes/coins and foreign currency travellers cheques to the public
  6. FLM 6- Register of sales of foreign currency notes/coins to authorized dealers / Full Fledged Money Changers / overseas banks
  7. FLM 7 - Register of travellers cheques surrendered to authorized dealers / authorized money changers / exported
  • These documents need to be kept up-to-date, cross-checked and the balances shall be verified on a daily basis whereas transactions which are outside the purview of money changing activities shall not be blend together.
  • Separate registers need to be maintained in case of more than one establishment.

Revocation of FFMC License by RBI -

If RBI can grant the license, then RBI also reserves the right to revoke the license granted to an AMC at any time if -

  • It is in public interest to do so or
  • The AMC has failed to comply with any condition subject to which the authorization is granted  
  • Has breached any of the provisions of the Foreign Exchange Management Act, 1999
  • The RBI also reserves the right to revoke the authorization of any of the offices or franchisee

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not corpseed, and have not been evaluated by corpseed for accuracy, completeness, or changes in the law.


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Vinay Thakur is Managing Partner in Corpseed. He focused on payments, digital transformation, and financial technology for over 15 years and holds strong expertise on fintech startups, banking innovation, and investors with a keen understanding of...
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