Banks get ready to count int'l credit card spend in liberalised remittance scheme
credit card spends in the liberalised remittance scheme (LRS) by April 1 — a plan that has been kept in abeyance for a year.
Under the belief that reissuing the specific notification may not go against the model code of conduct, many banks are preparing to integrate their systems with RBI’s for capturing the card spend information of individual customers during personal foreign tours.
NBBL is a subsidiary of National Payments Corp. of India (NPCI). As part of its 2025 vision document, the RBI wants all payment rails under a centralised payment system. Internet banking is the only one outside the umbrella and the regulator wants this within the fold quickly, putting it on a par with processes such as the Immediate Payment Service (run by NPCI) as well as the Real Time Gross Settlement and National Electronic Fund Transfer systems (run by the RBI).
Centralisation will allow standardisation of settlement cycles for merchants, visibility on data and proper customer grievance mechanisms, said one of the persons cited above.
“The RBI has had meetings with banks and industry officials. It does not want to delay the proposal though the industry thinks it could take longer,” said a banker.
The proposal will mean the transactions of an individual through international credit cards while being overseas will be part of the annual cap of $250,000 that a resident can remit abroad under LRS for opening offshore bank accounts, investing in stocks, and buying properties. Secondly, LRS spend beyond Rs 7 lakh would attract 20%
