EEFC account scheme was introduced in 1992, which enabled exporters and other exchange earners to retain a portion of the receipts with the authorized dealer in India. Such accounts can be maintained in non-interest bearing current accounts only.
Part - A
Exchange Management Regulations
1. Directions of RBI.
The general rule is that inward remittances received from abroad should be converted into Indian rupees, and the rupee amounts so arrived at should be paid to the beneficiaries resident in India. As an exception to this general rule, under the EEFC scheme introduced by RBI, exporters and other exchange earners if they so desire may retain a portion of the receipts in foreign exchange with an authorized dealer in India. At present a 100% Export Oriented Unit (EOU) or a unit in (i) Export Processing Zone (EPZ) and (ii) Software Technology park (STP) and (iii) Electronic Hardware Technology Park (EHTP) may credit up to 70% and any other person resident in India up to 50% of the inward remittances to the EEFC account.
2. Customer eligibility.
It should be noted that EEFC facility is available not only for exporters of goods and services but also for any person resident in India who is receiving remittances from abroad in a freely convertible currency.
3. Eligible inward remittances.
- EEFC facility is also available for advance remittances received by exporters in a freely convertible currency.
Foreign tourists who are on a visit to India are making payments to hotels in India by presenting International Credit Cards issued outside India in their favour. The hotels in turn obtain reimbursement in rupees from the Credit Card Servicing Organisations in India. The hotels are permitted to keep up to 50% of the amounts received by them in EEFC accounts, provided a certificate is issued by the Credit Card Servicing Organisations in India stating that they have realised the corresponding payments in a convertible currency in an approved manner.
4. Ineligible Inward Remittances.
The following categories of inward remittances are not eligible for EEFC facility:
a. remittances received from abroad persuant to undertakings given by the beneficiaries to the authorities concerned in India.
b. remittances received from abroad for meeting specific obligations