4 min readAug 20, 2026 07:40 PM IST
Reserve Bank of India (RBI) Deputy Governor Rohit Jain has flagged gaps in banks’ policies governing customer transactions, saying a recent review of banks’ websites found basic shortcomings that could affect customers’ ability to access information and complete transactions.
In some cases, banks referred customers to their schedule of charges or grievance redressal policies as being “available on the bank’s website” without providing a direct link, while documentation requirements for outward remittances were described so broadly that they offered little practical guidance.
Jain said these were not difficult problems to fix, and could be addressed if authorised dealer (AD) banks themselves went through the customer experience and made the necessary improvements.
Jain said a customer does not experience the Foreign Exchange Management Act (FEMA) as an Act or a Master Direction, but through his lived experience with the AD bank in terms of the documents a branch asks for, the quoted price, the time taken, and the quality of the explanation when a transaction cannot be done.
“As part of our supervisory exercise, we have found multiple documentation requirements and cases of delay in executing cross-border remittances,” Jain said while addressing the Annual Day of Foreign Exchange Dealers’ Association of India (FEDAI).
“Accordingly, we have advised AD banks through FEDAI to put in place a clear policy governing documentation, process and approving authority, charges, timelines, escalation, and grievance redress to be displayed on their websites and at branches offering cross-border services. The progress on this needs to be better,” Jain said.
Similarly, transparency is not a one-time disclosure exercise, he said. “Policies must be complete, current, intelligible and actually followed at the bank’s counter; compliance tested through internal or concurrent audit; staff trained, with proper succession planning so that capability does not sit with one officer; and customer feedback taken regularly and examined by people with requisite authority to change the process. No customer should suffer for a delay that arises from internal processing at the AD end,” he said.
Settlement of cross border transactions
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On cross-border trade in local currencies, Jain said local currencies will play an ever increasing role in cross-border trade and payments. The Special Rupee Vostro Account (SRVA) framework for invoicing, payment and settlement of international trade in rupees has been implemented keeping in view the evolving dynamics of our international trade, he said.
“Its success will depend on commercial viability, emphasis on trade settlement in local currencies, offering market-determined rates, and strengthening confidence in the settlement ecosystem. Opening a SRVA account is the easy part,” Jain said.
Jain said the harder task is identifying corridors with genuine two-way flows, building reliable correspondent relationships, quoting competitive conversion and hedging solutions, explaining the mechanics to first-time users, and finding avenues for the productive deployment of rupee balances — all resting on robust internal processes, AML/CFT controls, operational resilience and, above all, a willingness to facilitate these transactions, he said.
“I would encourage you not to see it only as a way of reducing reliance on international currencies. The settlement of cross border transactions in local currencies results in lower transaction costs, fewer currency mismatches, better settlement efficiency, and the ability to trade where correspondent banking is costly or constrained,” he said. “Policy can create the option. It is the authorised dealers who will determine whether this happens. I am confident that our banks can, and will rise to the occasion.”
