Full-Fledge Money Changer License 

Full-Fledged Money Changer is a company that carries out trading activities like forex currency after prior approval from the Reserve Bank of India (RBI). These companies are sanctioned under the Foreign Money Exchange Act of 1999. The RBI authorizes business entities to deal with foreign exchange for specific purposes. These business entities are referred to as Authorized Money Changers or AMCs.

From Foreign-Exchange or Forex trading to money exchanging, from dollars to rupees to any other currencies, becoming an Authorized Money Changer can assist you a lot.

Types of Authorized Money Changers (AMCs)s

There are three types of AMCs:

• Authorized Dealer Category: I (AD Category-I) Banks
• Authorized Dealer Category: II (AD Category –II) Banks
• Full-Fledged Money Changer (FFMC)

The reasons for the three types of AMCs to exist are the following:

• Foreign tourists have wider access to foreign exchange facilities.
• To enable residents to have wider access to foreign exchange facilities.
• Making sure that the customers get the most efficient services.
• To cater to the increasing competition in the market.

To work as an FFMC in India, the aspirant must get an FFMC License that the Reserve Bank of India issues. If any company dares to engage in Forex trading without the appropriate license, it will get penalized.

FFMC License requirements

Before filing for the registration of a Full-Fledged Money Changer license at the RBI, the applicant must fulfil the following pre-conditions:

• The Full Fledged Money Change applicant should be an incorporated company under the Companies Act of 2013.
• The minimum Net Owned Fund should be
  • INR 25 lakhs in case of a single branch, and
  • INR 50 Lakh in multiple branches.
• The money-changing activity should be specified in the Memorandum of Association of the company.
• The company should be clean, i.e. there should be no current legal cases lodged against the company at the Department of Enforcement or the Department of Revenue Intelligence.

Documents Required for FFMC License

The following documents must be submitted with the RBI FFMC application for the smooth registration process:

• Certificate of Incorporation of the applicant company.
• Copy of Memorandum of Association of the applicant company.
• Copy of Articles of Association of the applicant company.
• A confidential report from the Bank.
• The latest copy of the latest audited license sheet and the statutory auditors' certificate.
• Details of the nature of the business.
• If the applicant files another FFMC application, those are required as well.

FFMC License registration process

Following is the procedure to acquire the RBI Full-Fledged Money Changer license:

• Prepare yourself by running a background check on the existing licensed money changers. In your research, you'll see an FFMC license list. Scrutinize it from head to toe and research every full-fledged money changer license holder. It would give you a rough idea of the financial stability needed to run an operation once you get a currency exchange license in India.
• Incorporate the company under the Companies Act of 2013 and as per the RBI guidelines.
• Collect and collate the documents required to apply for an FFMC license online.
• File the Full-Fledged Money Changer license application online.
• Submit the requisite documents along with the application to the concerned jurisdictional office of the RBI.
• Liaison with the RBI until the FFMC license is acquired.

After inspection of the documents and the application, the RBI grants the FFMC License. With an FFMC license at your side, you can even start an online money-changing business if you wish.

FFMC license fee

There is no application processing fee for the FFMC license registration under the RBI.

Points to Ponder

• If you've received a notification that there is something wrong with your application, you have to take immediate action to rectify the issues. If you don't, you'll soon receive the notification that says, "FFMC License cancelled".
• Although forex trading is part of Full Fledged Money Changer, don't mistake this license with the Forex trading license or the Forex broker license. To get a Forex trading license in India, you'll need to adhere to the Forex Trading License requirements beyond the scope of a simple FFMC.
• You'll encounter sources that claim to have a money changer license for sale over your research. Don't fall into that trap. Report it the moment any such entity or individual.

FFMC License Cancellation

The Reserve Bank of India can revoke an FFMC license granted to a registered company at any time if the Bank states that -

• The revocation of the FFMC license is in the public interest;
• The FFMC license holder has failed to comply with the rule, regulation, notification, and direction or has contravened any of the provisions of the Act.

RBI can revoke the authorization of any of the offices of an FFMC on the grounds of infringement of any statutory or regulatory provision. The Reserve Bank can also revoke any existing FFMC licence conditions or impose new conditions. 

FFMC License Renewal 

• The renewal application from an FFMC license holder must be made two months before the expiry of the licence or the period as the Reserve Bank of India may prescribe.
• Suppose the RBI accepts the FFMC license renewal application. In that case, the licence can continue in force until the licence expiry date or if the RBI rejects the application.
• The RBI will not entertain any FFMC license renewal application after the expiry of the licence.

How can our assistance make you an RBI money changer?

For any assistance in this matter, you'd need the assistance of an FFMC license consultant. For FFMC License, RBI has created some special roadblocks to make the process difficult. Our consultants manually remove these roadblocks to provide you with a way to get a head start in the money changer business.

FFMC license: FAQs (Frequently Asked Questions)

Q. What is the full form of an FFMC?

A. FFMC stands for Full-Fledged Money Changer.

Q. What is the purpose of FFMC?

A. The objective of setting up an FFMC is to provide more access to foreign exchange facilities to residents and tourists while ensuring efficient customer service.

Q.  What are the various AMCs facilities available in the country?

A. To convert a foreign currency or travellers' cheques in foreign currency into Indian Rupees and vice versa, we have the following options available in the country:

1. AD Category-I Banks
2. Ds Category-II Banks
3. Full Fledged Money Changers (FFMCs)

Q. Who can apply for an FFMC licence?

A. The entity which is eligible for applying FFMC license is:

• A company registered under the Companies Act of 1956 or 2013, or Registration of Companies (Sikkim) Act of 1961, and
• Having a minimum Net Owned Funds (NOF) of

• • INR 25 lakh to apply for a single-branch FFMC license, and
  • NR 50 lakh to apply for a multiple-branch FFMC license.

Q. What is the estimated time when a licensed FFMC must commence its business operations?

A. newly FFMC licensed registered firm must commence its business operations

• Within six months from the date of license issue,
• Along with the copy of the registration under the Shops & Establishment Act, and
• Other relevant documents like a rent receipt, copy of lease agreements, etc.

This must be submitted to the RBI before commencing business operations.

Q. How to get your FFMC license renewed in India?

A. The renewal application from an FFMC license holder must be made two months before the expiry of the licence or the period the Reserve Bank of India may prescribe. Suppose the RBI accepts the FFMC license renewal application. The licence can continue in force until the licence expiry date or if the RBI rejects the application. The RBI will not entertain any FFMC license renewal application after the expiry of the licence.

Q. What is the FFMC license registration fee set by the RBI?

A. There is no application processing fee for the FFMC license registration under the RBI.

Q. What documents must be submitted when filing for the FFMC license registration application?

A. The following documents must be submitted with the RBI FFMC application for the smooth registration process:

• Certificate of Incorporation of the applicant company.
• Copy of Memorandum of Association of the applicant company.
• Copy of Articles of Association of the applicant company.
• A confidential report from the Bank.
• The latest copy of the latest audited license sheet and the statutory auditors' certificate.
• Details of the nature of the business.
• If the applicant files another FFMC application, those are required as well.