RBI tells banks to exercise caution on online forex trade payments

The RBI has observed instances where overseas foreign exchange trading has been introduced on a number of internet and electronic trading portals, luring Indian residents with offers of guaranteed high returns based on such forex trading

Mumbai: The Reserve Bank of India (RBI) today directed banks to exercise caution with respect to online forex trading by Indian residents where margin payments through a credit card or deposit are required in view of the risk of fraud, reports PTI.

“... Banks should exercise due caution and be extra vigilant in respect of the transactions that require residents to make margin payments for online forex trading transactions through credit cards/deposits in various accounts maintained with banks in India,” the RBI said in a notification.

The RBI said it has observed instances where overseas foreign exchange trading has been introduced on a number of internet and electronic trading portals, luring Indian residents with offers of guaranteed high returns based on such forex trading.

“The advertisements by these internet/online portals exhort people to trade in forex by way of paying the initial investment amount in Indian rupees. Some companies have reportedly engaged agents who personally contact people to undertake forex trading/investment schemes and entice them with promises of disproportionate/exorbitant returns,” it said.

According to the RBI, most of the forex trading through such portals is done on a margining basis with huge leverage, or on an investment basis, where the returns are based on forex trading.

“The public is being asked to make the margin payments for such online forex trading transactions through credit cards/deposits in various accounts maintained with banks in India.

“It is also observed that accounts are being opened in the name of individuals or proprietary concerns at different bank branches for collecting the margin money, investment money, etc,” it said.

The RBI warned that any person who is residing in India and engaged in collecting or remitting such payments either directly or indirectly abroad would be liable to face action as per the rules of the Foreign Exchange Management Act (FEMA) and other laws.

User

Govt to take decision on sugar exports on 21st November

The industry is seeking an early decision on sugar exports as global prices are softening and a further delay in announcing the policy would make exports unviable

New Delhi: Food minister KV Thomas today said the government will take a decision on allowing sugar exports in the 2011-12 marketing year on 21st November, reports PTI.

“We will take a decision on sugar exports on Monday next week,” Mr Thomas told reporters here.

The Empowered Group of Ministers (EGoM) on food headed by finance minister Pranab Mukherjee is meeting on 21st November to discuss the possibility of sugar exports this year, among other issues, he added.

Although Mr Thomas did not disclose the quantity of exports that the government might allow on 21st November, sources said the food ministry has proposed the export of 5 lakh tonnes of sugar initially under the open general licence (OGL) scheme.

Yesterday, agriculture minister Sharad Pawar had said the issue of sugar exports would be discussed in the forthcoming EGoM meeting.

The sugar industry has been demanding permission for the export of four million tonnes of sugar in the 2011-12 marketing year (October-September), as the country’s production is estimated at 25-26 million tonnes against annual domestic demand of 22 million tonnes.

The industry is seeking an early decision on sugar exports as global prices are softening and a further delay in announcing the policy would make exports unviable.

In the previous marketing year, the government had permitted 2.6 million tonnes of sugar exports, of which 1.5 million tonnes was through the OGL in three equal tranches.

Sugar production in India—the world’s second-largest producer and biggest consumer—rose to 24.3 million tonnes in 2010-11 from nearly 19 million tonnes in the previous year.

In this marketing year, the government has pegged sugar output at 25 million tonnes, while the industry has estimated production at 26 million tonnes.

User

Everest Industries: Rest Assured

Good growth plans in a profitable industry

We had written about Delhi-based Everest...

Premium Content
Monthly Digital Access

Subscribe

Already A Subscriber?
Login
Yearly Digital+Print Access

Subscribe

Moneylife Magazine Subscriber or MSSN member?
Login

Yearly Subscriber Login

Enter the mail id that you want to use & click on Go. We will send you a link to your email for verficiation

We are listening!

Solve the equation and enter in the Captcha field.
  Loading...
Close

To continue


Please
Sign Up or Sign In
with

Email
Close

To continue


Please
Sign Up or Sign In
with

Email

BUY NOW

The Scam
24 Year Of The Scam: The Perennial Bestseller, reads like a Thriller!
Moneylife Magazine
Fiercely independent and pro-consumer information on personal finance
Stockletters in 3 Flavours
Outstanding research that beats mutual funds year after year
MAS: Complete Online Financial Advisory
(Includes Moneylife Magazine and Lion Stockletter)