Indian central bank deputy urges banks to improve retail foreign exchange services
- RBI's Rohit Jain reveals Indian banks' retail forex policies have gaps, requiring clearer rules for customer charges and remittance timelines
MUMBAI: Indian lenders’ retail foreign exchange pricing shows a gap between regulatory intent and market outcome and banks should put in place clear policies governing charges and timelines, central bank Deputy Governor Rohit Jain said.
Jain made the comments in a speech last Friday that was released by the Reserve Bank of India on Wednesday, covering the current state of India’s foreign exchange market and the central bank’s priorities for the next decade.
A recent review conducted by the RBI revealed certain gaps in banks’ policies governing customer transactions, charges and documents required for outward remittances, Jain said.
India’s forex reserves climb past $700 billion on robust inflows
“We have found multiple documentation requirements and cases of delay in executing cross-border remittances,” he said, adding that the central bank has authorised lenders to outline clear policies for documentation charges, timelines, escalations and grievance redressals.
The average daily turnover in the Indian foreign exchange market, including spot and derivatives, has climbed to $80 billion, while daily turnover in the NDF market stands at about $7 billion, Jain said.
“Expanding the market-maker base, raising public sector bank participation, and encouraging electronic platforms are necessary priorities to be pursued,” he added.
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