RFC account scheme was introduced in 1992 which enables a citizen of India or a person of Indian origin who has been resident outside India has become a person resident in India to open an account in foreign currency in India.

Part - A 

Exchange Management Regulations: 

1.  Directions of RBI. 

The account can be opened out of foreign exchange earned as under: 

• Pension or any other super annuation or other monitory benefits from his employer outside India
   
• Realised on conversion of investment in foreign currency, foreign security or any immovable property situated outside India if such currency, security or property was acquired, held or owned when the person was resident outside India
• Received or acquired as gift or inheritance from a person who realized on conversion of investment in foreign currency, foreign security or any immovable property situated outside India if such currency, security or property was acquired, held or owned when the person was resident outside India  
• Received or acquired before the eight-day of July 1947 or any income arising or accruing thereon which is held outside India in pursuance of a general or special permission granted by the RBI.

2.  Customer eligibility 

It should be noted that RFC facility is available for any person resident in India.

3.  Type of accounts: 

Only term deposits can be opened.

4.  Utilisation of funds in RFC: 

• The funds in RFC shall be free from all restrictions regarding utilization including any restriction on investment in any form, by whatever name called outside India.  
• Withdrawals / payments from such accounts other than for remittance outside India or for payments in foreign currency authorized shall be permitted by the authorized dealer in equivalent Indian rupees.