RBI Releases Guidelines on Deposits and Accounts for Overseas Branches:

RBI Releases Guidelines on Deposits and Accounts for Overseas Branches On Thursday the RBI stated that rupee accounts, which are non-interest-bearing, can be opened or closed by banks. That too, without referring to the central bank prior, banks can do it in the name of their overseas branches or reporters. The Reserve Bank of India has special rules for banking with Pakistani banks operating outside Pakistan. If you want to open a rupee account for these banks, you need specific approval from the Reserve Bank. When money is sent to a non-resident bank's account, it's considered a payment to non-residents and must follow foreign currency transfer rules. When money comes from a non-resident bank's account, it's treated as an incoming foreign currency payment. Indian banks can buy foreign currency from their overseas partners or branches at current market rates to put money in their accounts for legitimate needs in India. However, these accounts need to be watched carefully to make sure overseas banks aren't speculating on the Indian Rupee. Any suspicious activity should be reported to the Reserve Bank. The rules prohibit forward buying or selling of foreign currencies against the rupee for sending money abroad or funding. Also, banks cannot offer two-way quotes in rupees to non-resident banks.