KOZHIKODE: In a major crackdown on private full-fledged money changers (FFMC) in Kerala, the Reserve Bank of India (RBI) has cancelled the licences of eight FFMCs after special checks conducted by RBI officials unearthed major violation of RBI norms.
A senior RBI officer said that the licences of the FFMCs were cancelled following a series of inspections. “We have been monitoring the activities of the FFMCs closely for a while. They have either failed to maintain a proper register on the volume of transactions or the prescribed Net Owned Funds (NoFs) based on their licence criterion. Action has been initiated mainly for delayed commencement of operations, improper book keeping and mismatch in conversion rates,” said the officer, who refused to divulge further details. The money changers were into converting foreign currency, coins or travellers’ cheques into Indian rupees(INR) for the benefit of tourists and foreign travellers.
The RBI at one point of time had allotted licences to a lot of private firms to give easy access to travellers and tourists on foreign currency exchange facilities in every nook and cranny of the country. As per a notification issued by the RBI, the private FFMCs whose licences cancelled include five from Kochi, one from Malappuram, one from Thiruvananthapuram and one from Thrissur. The big names which were listed in the notification included Cee & Cee Gold & Forex Private. Ltd and Agro Indus Finance & Leasing (India) Ltd.
While an official spokesperson of Agro Indus Finance & Leasing (India) Ltd said that their firm’s name figured on the list because of the company’s earlier association with a Forex firm which is now defunct, the repeated attempts to contact Cee & Cee Gold & Forex Private. Ltd did not succeed since because the contact number given by the firm in various directories was incorrect. Meanwhile, spokesperson of another FFMC said that there was drastic fall in business in the last couple of months and it was not viable to continue with the business.
The crackdown was not limited to FFMCs in Kerala but in other states too. The licences of 73 FFMCs were cancelled in Gujarat, 21 in Karnataka, 78 in Punjab, 201 in TN, 25 in Telangana, 113 in Delhi, seven in Madhya Pradesh, four each in Maharashtra and Rajasthan, three in UP, two in Bengal and one each in Odisha and Goa.
Breach of norm