RBI: Forex Transaction Disclosure Draft

Mumbai, Dec 9 (PTI) Reserve Bank on Tuesday came out with a draft circular on disclosure of foreign exchange transaction cost with a view to promoting greater transparency in such dealings.

RBI has invited comments on the draft circular from banks, market participants and other interested parties by January 9, 2026.

"To enhance transparency in the foreign exchange market, in January 2024, Authorised Dealers were mandated to provide the mid-market mark/bid and ask price of the foreign exchange derivative contract/foreign currency interest rate derivative contract before entering into the contract with a retail user and include the same in the deal confirmation/term sheet,” RBI said in a statement.

As a further step towards promoting greater transparency in the foreign exchange market, it is proposed to mandate Authorised Dealers to provide the details of transaction cost (remittance fees, foreign exchange rate, currency conversion charges, etc.), associated with foreign exchange cash, foreign exchange tom and foreign exchange spot contracts offered to retail users, it said.

On a review, it has been decided that while offering foreign exchange cash, foreign exchange tomorrow (where a currency trade is settled the next business day) and foreign exchange spot contracts to a retail user, Authorised Dealers should provide to the user details of the total transaction cost (showing all relevant costs and charges), it said.

Relevant costs and charges would include ending and receiving fees, including those of any intermediaries, foreign exchange rate and currency conversion charges, before entering into the contract and also include the same in the deal confirmation, it said.