Full Fledged Money Changers

Package Inclusion :

  • FFMC Advisory Service 
  • Private/Public Limited Company Formation
  • Documentation for FFMC License
  • Filing of FFMC License Application
  • Liaisoning with the Reserve Bank of India and FEMA Department

Full Fledged Money Changers

What do you mean by Full Fledged Money Changers (FFMC)?

A company which intends to carry out the activities of forex currency exchange after obtaining the prior approval of Reserve Bank of India shall be regarded as Full Fledged Money Changers (FFMC).

Under Section 10 of the Foreign Exchange Management Act, 1999, the Reserve Bank of India authorizes entities to deal in foreign exchange for specific purposes. These entities are called as Authorized Money Changers (AMCs).

There are three different types of AMCs:

The purpose of the above mentioned three types of Authorized Money Changers is to enable residents and tourists to have wider access to foreign exchange facilities. The objective is also to ensure that customers get the best and the most efficient service, with increased competition.


What is Full Fledged Money Changers License in India?

In order to work as an authorized money changer in India, one needs to apply for a valid full fledge money changer license which is issued by the Reserve Bank of India and if any person or organization found to be operating money changing activities without the appropriate license will be liable to be penalized as per the laws.

For obtaining an FFMC license in India, it is mandatory that the company is registered under the Companies Act, 2013.
The RBI annually publishes the applicable guidelines for Full Fledged Money Changers in the form of a master circular called the Memorandum of Instruction on Money Changing Activities. Every entity intending to enter or already involved in the money changing activities in India need to follow these guidelines as well as the provisions mentioned in the Foreign Exchange Management Act, 1999.


What is the eligibility criterion for FFMC License in India?

The eligibility criteria for companies to obtain the FFMC license are:-


What are the basic requirements for FFMC License in India?


Which authority regulates the framework for FFMC License in India?

In India, the framework for FFMC License is regulated by the Reserve Bank of India as per Section 10 of the Foreign exchange Management Act, 1999. It is mandatory for a license holder to comply with the directions & guidelines issued by the RBI. FFMC License holder shall not engage in any transaction which is not in conformity with the authorization terms. RBI may at any time revoke the FFMC license if it is in the public interest.

Reserve Bank of India is empowered to inspect the books of accounts and other documents of FFMC as per FEMA, 1999. For carrying out the inspection, full assistance and co-operation shall be provided to the investigating authority. However, if the FFMC fails to produce books of accounts, or any other document or fails to answer any question asked by the authority then it shall be considered a contravention of the provisions.


What is the procedure of obtaining FFMC License from the RBI?

The application form for the FFMC license needs to be downloaded from the website of RBI. Along with the required supporting documents, the application form needs to be submitted to the Foreign Exchange Department of the Reserve Bank of India at the regional center under the purview of which the registered office of the applicant falls.


Step by Step procedure for obtaining the FFMC License


What are the documents required for filing FFMC License application?

The supporting documents that need to be submitted for obtaining the FFMC license include:-


How KBNG  will help you in obtaining FFMC License from RBI?

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What are the requirements need to be fulfilled for obtaining FFMC License?

There are certain requirements which need to be fulfilled in order to obtain FFMC license in India-

What are the rules regarding FFMC License Renewal?

FFMC license holder has to file a renewal application every year along with the applicable documents with the Reserve Bank of India. The renewal application shall be filed at least one month prior to the expiry of the FFMC license. Once an application is made for FFMC license renewal, it shall be valid until the expiry date or rejection date as the case may be. If the FFMC license is expired, no renewal application can be made.


What are the guidelines regarding the maintenance of books of accounts by FFMC?

For FFMCs in India, it is required to maintain following registers in respect of the money changing activities:

Forms Description
FLM 1 Daily Summary and Balance Book (Foreign currency notes/coins)
FLM 2 Daily Summary and Balance Book (Travellers' cheques)
FLM 3 Register of purchases of foreign currencies from the public
FLM 4 Register of purchases of foreign currency notes/coins from authorized dealers and authorized money changers
FLM 5 Register of sales of foreign currency notes/coins and foreign currency travelers' cheques to the public
FLM 6 Register of sales of foreign currency notes/coins to authorized dealers / Full Fledged Money Changers / overseas banks
FLM 7 Register of travelers' 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.

What are the circumstances under which an FFMC License can be revoked by RBI?

The Reserve Bank reserves the right to revoke the license granted to an AMC at any time if it is in the opinion of the Reserve Bank of India that

Who can obtain a Franchise License from the existing FFMC?

To obtain the franchise license from the existing FFMC there is a requirement of two things such as:

If the above-mentioned requirements are fulfilled, the Franchise agreement will be executed. Franchisee agreement will describe the tenure which shall be decided by the FFMC and the commission and fees payable to the franchise as mutually decided between the parties.

Features of the Franchise Agreement

How to obtain a franchise license from the existing FFMC?

For obtaining a franchise license, an application shall be made in Form RMC-F accompanied by a declaration that adequate due diligence of the entity has been carried out prior to the entering into the Franchise Agreement.

How to conduct Due Diligence of Franchisees?

While conducting the due-diligence of the Franchisees, following things must be considered:

What are the reporting requirements for FFMC?

What are the guidelines regarding grant of license for setting up an additional branch?

For setting up an additional branch to carry out the money changing activity prior approval of RBI is required. For this purpose, a written application shall be submitted to the regional office of the RBI where the registered office of the company is situated. The main purpose of setting up an additional branch is that adequate money exchange facilities shall be provided in the remote areas of tourist attraction.

For setting up additional branch following documents are required:




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