Master Direction - Other Remittance Facilities: paragraphs 1, 3, 6 and 7 on travel, cards, salary and Form A2

Master Direction explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.

The Reserve Bank's Master Direction - Other Remittance Facilities tells authorised dealers how to release foreign exchange for travel and other everyday current account needs of residents, how to treat international cards, and what to collect before releasing it. This article reads paragraphs 1, 3, 6 and 7 and points out where the Master Direction ties back to the Rules and to the Liberalised Remittance Scheme. Questions on your own travel or card arrangements can go to our FEMA advisory team.

As per the Master Direction, updated as on May 06, 2026, a traveller's foreign exchange is part of the overall USD 250,000 per financial year limit, with foreign currency notes and coins sold only up to the per-visit cash limits printed in paragraph 3.1.1. Unspent exchange may be surrendered to an authorised person within 180 days. For payments other than imports and intermediary trade the applicant fills Form A2, and the bank must obtain it in physical or digital form for all cross-border remittances.

The text and its legal footing

The text is the Master Direction - Other Remittance Facilities, FED Master Direction No. 8/2015-16, January 1, 2016, "Updated as on May 06, 2026". It is a direction by the Reserve Bank to authorised persons made under section 11 of the Foreign Exchange Management Act, 1999, in terms of section 5; see our articles on section 11 and 12 and section 5. It binds authorised persons, so this article tells you what the bank will ask for and do. Paragraphs 2 and 5 of the Master Direction are printed "", and paragraph 4 is covered in our article on remittances by companies and firms. Form A2 (Annex 2) is not on the page consulted. Later amendments and circulars should be checked on the Reserve Bank site.

Paragraph 1: how banks read the Rules

Paragraph 1.1 tells authorised dealers to be guided by the Current Account Transactions Rules, 2000. It summarises them: drawal for Schedule I categories is expressly prohibited; exchange for Schedule II transactions may be permitted provided the applicant has secured the approval of the Ministry or Department specified; for Schedule III, prior approval of the Reserve Bank is needed for remittance exceeding the specified limits, and release up to the threshold ceilings stands delegated to authorised dealers. Applications above the Schedule III limits go to the Regional Office of the Reserve Bank's Foreign Exchange Department under whose jurisdiction the applicant functions or resides. See the articles on Schedule I and Schedule III.

• 1.2: drawal also includes use of international credit cards, international debit cards and ATM cards, so all rules, regulations and directions apply to them.
• 1.3: release of foreign exchange is not admissible for travel to, and transaction with residents of, Nepal and Bhutan.
• 1.4: remittances in any form towards participation in lottery schemes are prohibited, including lottery-like schemes under other names such as a money circulation scheme, or remittances to secure prize money or awards.
• 1.5: a warning on fictitious offers of cheap funds. Paying "processing fees" and similar charges outwards can make a resident liable for contravention of the Act, and the Reserve Bank states that it does not maintain accounts in the name of individuals, companies or trusts in India to hold funds for disbursal.

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Paragraph 3: facilities for resident individuals

Paragraph 3 first says the current account transactions under paragraph 1 of Schedule III (private visit, gift or donation, going abroad on employment, emigration, maintenance of close relatives abroad, business trip, medical treatment abroad, studies abroad) are subsumed under the Liberalised Remittance Scheme limit of USD 2,50,000 per Financial Year with effect from May 26, 2015. Release above USD 2,50,000 requires the prior permission of the Reserve Bank. See the Liberalised Remittance Scheme article.

3.1 Travel: cash limits, surrender and retention

These are limits on the cash form only, "out of the overall foreign exchange" sold to the traveller. Paragraph 3.1.2 allows authorised dealers to remit up to a reasonable limit, at the traveller's request, for hotel accommodation and tour arrangements in the countries to be visited, and says tour expenses such as rail, road and water transport outside India, Euro Rail, passes and tickets, and overseas hotel and flight charges are subsumed under the USD 250,000 limit.

Surrender (3.1.3). Exchange bought for one purpose may be used for any other eligible purpose. General permission is available to any resident individual to surrender received, realised, unspent or unused exchange to an authorised person within 180 days from the date of receipt, realisation, purchase, acquisition or the traveller's date of return. After 180 days, the authorised person should not refuse to buy the exchange merely because the period has expired. The uniform limit of 180 days applies only to resident individuals and in areas other than export of goods and services.

Unspent exchange (3.1.4). A returning traveller may retain foreign currency, travellers' cheques and currency notes up to an aggregate USD 2000, and foreign coins without any ceiling, beyond 180 days, and may use them for a later visit.

3.2 and 3.3 Salary and medical expenses

Paragraph 3.2 repeats the net salary facility for a person resident but not permanently resident, in the same words as the third proviso to paragraph 1 of Schedule III. Paragraph 3.3 says that where a resident individual pays the medical expenses of an NRI close relative (relative as defined in section 2(77) of the Companies Act, 2013), the payment is a resident to resident transaction that may be covered under regulation 3(3) of Notification No. FEMA 14(R)/2023-RB dated December 21, 2023. That notification is not in the sources consulted.

3.4 Cards

• International credit cards (3.4.1). Rule 5 does not apply to use of cards by residents for expenses on a visit outside India. Residents can use them on the internet for any purpose for which exchange can be bought from an authorised dealer, for example books or downloadable software. They cannot be used for prohibited items such as lottery tickets, banned or proscribed magazines, sweepstakes or call-back services. No separate aggregate monetary ceiling is prescribed for internet use. Residents with foreign currency accounts may obtain cards from overseas banks, and charges are met from that account or by remittances through the bank where the card holder has a current or savings account, directly to the issuing agency and not to a third party. Use in Nepal and Bhutan is not permitted. Authorised dealers may issue cards to NRIs and PIOs without prior approval, if charges are settled out of inward remittances or NRE or FCNR balances.
• International debit cards (3.4.2). Usable for cash or merchant payment during a visit abroad, only for permissible current account transactions, with the Schedule limits applying; not for prohibited items on the internet.
• Airline tickets (3.4.3). The practice of foreign airlines settling rupee ticket sales through overseas banks is stated not to conform to the Act, and banks may advise airlines to stop it.
• Store value, charge or smart cards (3.4.4). No prior permission is required to issue them; use is limited to permissible current account transactions; fees and charges payable in India are denominated and settled in rupees.
• Redemption of prepaid travel cards (3.4.5). Refund of the unutilised balance is permitted only after 10 days from the last transaction, and the authorised person shall redeem the unutilised balance on request, subject to retention of amounts authorised but unsettled, a small balance not exceeding US$ 100 for pipeline transactions, and transaction fees.

Paragraph 6: operational instructions and Form A2

• 6.1: the Reserve Bank will not prescribe the documents that authorised persons verify for current account remittances.
• 6.2: under section 10(5) of the Act, before undertaking a transaction the authorised dealer obtains a declaration and information that reasonably satisfy him that it is not designed to contravene or evade the Act, rules, regulations, notifications, directions or orders. The records are preserved for verification by the Reserve Bank; the onus of correct details remains with the applicant.
• 6.3: if the applicant refuses or complies unsatisfactorily, the authorised person refuses in writing and, if he has reason to believe contravention or evasion is contemplated, reports to the Reserve Bank.
• 6.4: for payments other than imports and remittances covering intermediary trade, the applicant fills Form A2; it is retained for one year, with related documents, for verification by internal auditors.
• 6.5: authorised dealers shall obtain Form A2 in physical or digital form for all cross-border remittances, irrespective of value, and other related documents if necessary, under section 10(5), framing internal guidelines approved by their Board, and continuing to follow KYC guidelines.

Paragraph 7 states that the Reserve Bank will not issue instructions on tax deduction at source for remittances to non-residents; authorised dealers must comply with the tax laws. For the tax side, see our income-tax guide on Form 15CA and 15CB.

Section B of the Liberalised Remittance Scheme Master Direction

The Master Direction on the Scheme (updated as on September 06, 2024) adds instructions to banks in its Section B: a minimum account relationship of one year before capital account remittances, or due diligence and a bank statement for the previous year if the applicant is new; payment out of the applicant's own funds by cheque, debit, demand draft, pay order or card; the dealer's certificate that remittances are not made to or by ineligible entities; reporting in FETERS; and the rule that banks should not extend credit to facilitate capital account remittances.

Example

Meera, a resident, leaves for a conference in a country that is not on the special lists. She may take foreign currency notes and coins not exceeding USD 3000 per visit under paragraph 3.1.1, with the rest of her foreign exchange in a card or remitted for her hotel. She returns with USD 1,200 unspent. Paragraph 3.1.4 lets her retain up to USD 2000 aggregate, so she may keep it for her next trip, or surrender it to an authorised person within 180 days.

Common mistakes

• Treating the per-visit cash limits as the total limit. They are for notes and coins, out of the overall limit.
• Thinking 180 days is an expiry date for surrender. Paragraph 3.1.3 says the authorised person should not refuse to buy merely because the period has passed.
• Expecting the Reserve Bank to list documents. Paragraph 6.1 says it will not.

Need help with travel, cards or remittance paperwork?

If you are preparing a stream of remittances or a corporate card programme, our FEMA advisory team can check each against the Master Direction and prepare a declaration pack your bank will accept.

Key takeaways

• Paragraph 3.1.1 prints per-visit cash limits of USD 3000 and USD 5000, and full exchange for the listed destinations.
• Surrender within 180 days; USD 2000 aggregate may be retained.
• Rule 5 does not apply to credit card use on a visit outside India; Nepal and Bhutan are excluded.
• Form A2 is required for all cross-border remittances in physical or digital form.
• Paragraph 4 and the Scheme's Section B are covered in the sibling articles.

Read next

• Liberalised Remittance Scheme: Master Direction
• Remittance limit for individuals: rule 5 and Schedule III
• Remittances by companies and firms: Schedule III and rules 6 and 7
• LRS: permitted and prohibited transactions

Disclaimer: Based on the rules, regulations and Reserve Bank Master Directions under the Foreign Exchange Management Act, 1999 that this article names, each in the version and up to the date stated in the article, as consulted on 2 October 2026. Some texts are third-party copies or older prints and are identified as such. Limits, forms and time limits change by amendment and circular; later changes should be checked on the Reserve Bank and Gazette sites. This article is general information, not legal advice; check the official text before acting.