Wednesday, 18 July 2018
RBI makes PAN mandatory for Current Account Transactions under LRS
The Reserve Bank of India (RBI) had made Permanent Account Number (PAN) mandatory for making all remittances under the Liberalised Remittance Scheme (LRS) for current account transactions of up to USD 25,000 by notification dated June 19, 2018. In furtherance, it has been decided that the definition of relative shall be aligned with the definition of ‘relative’ under the Companies Act 2013, thereby narrowing its scope.
The system for daily reporting of individual transactions under the LRS by authorized banks was introduced by RBI on April 05, 2018. Prior to the notification, PAN card was only mandatory for capital account transactions. Currently, under the LRS, authorized banks may allow remittance by resident individuals up to USD 2,50,000 per financial year for current or capital account transaction or a combination of both.