Economics · Foreign Exchange Management
A resident individual in India who has returned after a continuous stay of at least one year abroad is eligible to open and maintain a Resident Foreign Currency (RFC) account with an Authorized Dealer bank. According to the FEMA regulations, which of the following accurately describes the permissible credits into such an account?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1The account must be closed immediately if the resident individual decides to take up employment again in India.
- 2Only pension amounts and interest earned on overseas bank accounts can be credited while capital gains must be converted immediately.
- 3The account can be credited with the entire amount of foreign exchange received as proceeds of life insurance policy claims or inheritance from a person residing outside India.✓
- 4Credits are limited to fifty percent of the total foreign exchange earned during the stay abroad.
Correct answer
The account can be credited with the entire amount of foreign exchange received as proceeds of life insurance policy claims or inheritance from a person residing outside India.
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