The Reserve Bank of India (RBI) has issued a significant update regarding the Liberalised Remittance Scheme (LRS) for resident individuals, specifically discontinuing the requirement for monthly reporting by Authorised Dealer Category-I (AD Category-I) banks. This change follows a review of the existing reporting system under the LRS, which was previously governed by a series of circulars, starting with A.P. (DIR Series) Circular No. 36, dated April 4, 2008, and including subsequent updates such as Circular No. 11 dated December 22, 2023.
Under the earlier system, AD Category-I banks were required to submit information on the number of LRS applications received and the total amount remitted on a monthly basis. This data had to be reported through the Centralised Information Management System (CIMS). However, effective from the reporting month of September 2024, this requirement will be discontinued. Specifically, the monthly LRS return (Return code: R089) will no longer need to be submitted by the banks.
Going forward, AD Category-I banks will now be required to upload transaction-wise information under the LRS on a daily basis. The new reporting requirement, with the return code R010, mandates that banks submit data at the close of business on the next working day via the CIMS portal (URL: https://sankalan.rbi.org.in). If no transactions have been made on a particular day, the banks are required to upload a ‘NIL’ report.
This change also renders several earlier circulars obsolete. These include A.P. (DIR Series) Circular No. 36 dated April 4, 2008, Circular No. 106 dated May 23, 2013, Circular No. 23 dated April 12, 2018, Circular No. 07 dated June 17, 2021, and Circular No. 11 dated December 22, 2023. All instructions issued under these circulars stand withdrawn with immediate effect.
AD Category-I banks are advised to inform their constituents about this update and the shift in the reporting procedure. The RBI has also indicated that the Master Direction on Reporting under the Foreign Exchange Management Act (FEMA), 1999, will be updated to reflect this change.
These directives have been issued under Sections 10(4) and 11(1) of FEMA, 1999, and are without prejudice to any permissions or approvals that might be required under other applicable laws. This shift toward daily transaction-wise reporting is aimed at enhancing the accuracy and timeliness of data collection under the LRS.
