India RBI Rules Tighten Cross‑Border Docs
New RBI rules flagged on YouTube indicate tighter banking and tax compliance in India that could increase scrutiny of foreign accounts and source‑of‑fund documentation — a practical headache for clients moving money for visas or investments. The guidance raises a need for clearer evidence trails in international transfers used for immigration filings. (youtube.com)
A.P. (DIR Series) Circular Nos. 12 and 13 dated July 3, 2024 require authorised‑dealer banks to obtain Form A2 for all cross‑border remittances, replacing the earlier practice that let small current‑account payments proceed without A2. (rbi.org.in)) The July 3, 2024 package also removed the previous USD 25,000 operational safe‑harbour for outward payments and explicitly allowed submission of Form A2 in either physical or online formats to facilitate bank processing. (worldtradescanner.com)) RBI’s remittance rules now force banks to record RBI purpose codes for every inward and outward transfer under Annexure II, and banks commonly issue electronic Foreign Inward Remittance Advice (e‑FIRA) or e‑FIRC as the formal proof of receipt. (rbi.org.in)) The Reserve Bank replaced its 2016 KYC master direction with strengthened KYC/AML directions in 2025, authorising enhanced customer due diligence and periodic re‑KYC drives for banks and regulated entities. (rbi.org.in)) Indian authorised‑dealer banks have increased pre‑clearance checks under the Liberalised Remittance Scheme (LRS), routinely requesting PAN, evidence of source of funds, and, where applicable, Form 15CA/15CB before releasing outward remittances. (economictimes.indiatimes.com)) Tax rules were tightened on outward transfers effective April 1, 2025: the TCS exemption threshold for LRS was raised to ₹10 lakh per financial year and a 20% TCS rate applies to many investment/gift remittances above that threshold. (cleartax.in)) Practitioners documenting Source‑of‑Funds and Path‑of‑Funds for immigration investment programs (including EB‑5) must now reconcile Indian bank filings (Form A2, 15CA/15CB, e‑FIRA/FIRC) with remittance trails, as legal guides and immigration advisories identify these documents as central to USCIS source‑of‑fund portfolios for Indian remitters. (visaverge.com))
