The Reserve Bank of India (RBI) has released detailed new rules under the Foreign Exchange Management (Authorised Persons) Regulations, 2026.
The new framework sets stricter conditions for banks, NBFCs, and other entities dealing in foreign exchange (forex).
The RBI says the updated rules are aimed at improving transparency, strengthening regulation, and simplifying the approval process.
Existing Forex Dealers Can Continue for Now
According to the RBI, entities that already have authorisation to deal in foreign exchange can continue operating until their current approval expires.
However, they will now have to follow:
The new 2026 regulations
RBI directions issued from time to time
Existing conditions mentioned in their authorisation
RBI Introduces Online Application System
Entities seeking fresh approval to offer forex services will now have to apply through the RBI’s PRAVAAH portal.
Applications must be submitted to the RBI regional office under whose jurisdiction the company’s registered office is located.
RBI Divides Forex Dealers Into 3 Categories
The central bank has introduced three categories for fresh authorisation applications.
AD Category-I
This category is meant for banks licensed by the RBI.
AD Category-II
This category includes:
RBI-licensed banks
RBI-registered NBFCs
Existing Full-Fledged Money Changers (FFMCs)
Forex Correspondents operating for at least two years
These entities must also have an average annual forex turnover of ₹50 crore during the previous two financial years.
AD Category-III
This category is for:
Companies needing forex services for their business activities
Entities planning to launch innovative forex-related products and services
No New Licenses for Money Changers
One of the biggest changes is that the RBI will no longer consider fresh applications for new Full-Fledged Money Changers (FFMCs).
Only applications that were already under process before the new rules came into effect will be considered.
The RBI also clarified that if additional documents are requested, applicants must submit them within 30 days.
Otherwise, the application will automatically be treated as rejected.
New Eligibility Rules Introduced
The RBI has also introduced stricter eligibility conditions for companies applying for forex authorisation.
Some important conditions include:
The applicant must be a company registered under the Companies Act, 2013
The company’s Memorandum of Association (MoA) must mention forex-related activities
Minimum Net Worth Requirement
The RBI has fixed minimum net worth requirements for authorised entities.
The required net worth is:
₹10 crore for AD Category-II entities
₹2 crore for AD Category-III entities
Rules for Renewal of Existing Licenses
Existing authorised persons can apply for renewal under the new rules.
The RBI has fixed minimum net worth conditions for renewal as well:
₹25 lakh for single-branch FFMCs
₹50 lakh for multi-branch FFMCs
₹10 crore for AD Category-II
₹2 crore for AD Category-III
Entities must apply for renewal at least two months before their existing authorisation expires.
If the renewal application is submitted on time, the current licence will remain valid until the RBI approves or rejects the request.
Why These New Rules Matter
The RBI’s new forex regulations are expected to bring tighter control and better monitoring of foreign exchange services in India.
The move could also encourage more organised and transparent operations in the forex sector while limiting unregulated expansion.
