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Notification No. FEMA 10A/2014-RB dated 21st March, 2014
Crystallisation of Inoperative Foreign Currency Deposits
Notification No. 10A and this circular require banks to crystallize and convert credit balances in any inoperative foreign currency denominated deposit into Indian Rupee as under: –
1. In case a foreign currency denominated deposit with a fixed maturity date remains inoperative for a period of three years from the date of its maturity, than at the end of the 3rd year, the bank has to convert the balances lying in the foreign currency denominated deposit into Indian Rupee at the exchange rate prevailing as on that date. Thereafter, the depositor will be entitled to claim either the said Indian Rupee proceeds and interest thereon, if any, or the foreign currency equivalent (calculated at the rate prevalent as on the date of payment) of the Indian Rupee proceeds of the original deposit and interest, if any, on such Indian Rupee proceeds.
2. In case of foreign currency denominated deposit with no fixed maturity period, if the deposit remains inoperative for a period of three years (debit of bank charges not to be reckoned as operation), the bank must, after giving three months’ notice to the depositor at his last known address as available with the bank, convert the deposit from the foreign currency in which it is denominated to Indian Rupee at the end of the notice period at the prevailing exchange rate. Thereafter, the depositor will be entitled to claim either the said Indian Rupee proceeds and interest thereon, if any, or the foreign currency equivalent (calculated at the rate prevalent as on the date of payment) of the Indian Rupee proceeds of the original deposit and interest, if any, on such Indian Rupee proceeds.
