RBI tightens reporting norms for LRS

On 13th April 2018, the Reserve Bank of India (RBI) has tightened reporting norms for the Liberalised Remittance Scheme (LRS) under which an individual can transfer upto $ 2,50,000 US Dollars abroad in a year. The central bank has made it mandatory for banks to file a daily report of all such transactions. In a notification, RBI stated that these daily reports will be accessible to all other banks and make the verification easier. The purpose of this move is to improve monitoring and also to ensure compliance with the LRS limits. Currently, the LRS transactions are permitted by authorised dealer (AD) banks based on the declaration made by the remitter as there is no way to verify the claim independently. Now, as per new norms, banks will be required to upload daily transaction-wise information undertaken by them under LRS. Under the LRS, Indians are currently allowed to invest overseas $250,000 a year per person.

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