CAIIB-BFM (TOPIC: FEDAI).
FEDAI (Foreign Exchange Dealers Association of India) is registered under Companies Act 1956 & was incorporated in the Year 1958. The Associaton has been recognized by RBI, as well as GOI. The main functions of FEDAI are to lay down uniform rules & guidelines to be observed by all dealers in India.
Some of Its functions are:
1. Maintaining a close liaison with RBI & GOI.
2. Maintaining a liaison with International Chamber of Commerce & Other World bodies related to Foreign Trade & Business.
3. To Circulate various policies matters & decisions related to FOREX business amongst the members.
4. Represents Indian FOREX dealers on policy matters related to FOREX dealings.
5. Maintaining of FEDAI rules regarding Transit Period, Crystallization, Forward Covers etc.. that govern all the members.
6. Other functions include approving FOREX brokers.
IMPORTANT FEDAI RULES:
1. All cancellations shall be bu Bank's opposite TT rates, TT selling rate for purchase contract & TT buying rate for sale contract.
2. In the event of delay in Payment of Interbank Foreign currency funds, Interest 2% above the prime rate of the currency of the specified Banks shall be paid by the seller Bank.
3. In event of delay in Payment of ₹. Settlement funds, Interest for delayed period 2% above NSE MIBOR ruling on each day.
4. FEDAI, also prescribes code of conduct for FOREX dealers as also guidelines with regard to dealings with FOREX brokers.
MORE IMPORTANT FEDAI RULES:
-HOURS OF BUSINESS: Left at the descretion of the Banks now. Extended business hours for dealers, if any, should be approved by respective Management.
RATES: ADs will quote exchange rates in direct terms.
All Currencies to be quoted -- /Unit of Foreign Currency = INR.
(while JPY to be quoted as 100Units of JPY=INR).
-EXPORT BILLS FOR COLLECTION: In the event of ADs delay of Payment to exporter, they will pay Interest form date of realization to the date of Actual Payment. ADs may utilize 1-3 claim to release Payment depending upon the distance/location of Branch where Payment has to be remitted.
-CRYSTALLIZATION: Unpaid Export bills should be crystallized at TT selling rate. Earlier FEDAI rule made it mandatory to crystallize unpaid demand bills 30days after the the transit & Usance Bills, 30days after the due date. However FEDAI has given the authorized dealers the freedom to decide-on the period for crystallization which may be linked to Risk Factors like Credit perception of different types of exporter clients, operational aspects etc. In case the bills are realized after crystallization, TT Buying rate is to be applied.
-IMPORTS: Unpaid Foreign Currency bills drawn under L/C will be crystallized on delay from due date at Bills Selling Rates or Contracted Rates.
-INWARD REMITTANCES: All Foreign Currency inward remittances equivalent to ₹.1 Lac should immediately be converted in Indian Rupees. Inward remittance for more than ₹.1 Lac may be converted at the request of the customer but with the permissible period. If the Payment of inward remittance is delayed, ADs will Pay Interest @ 2% over the applicable to SB A/c's after a period of 10days, for remittances up to ₹.1 Lac & for 3days after remittances for more than ₹.1 Lac..
FEDAI (Foreign Exchange Dealers Association of India) is registered under Companies Act 1956 & was incorporated in the Year 1958. The Associaton has been recognized by RBI, as well as GOI. The main functions of FEDAI are to lay down uniform rules & guidelines to be observed by all dealers in India.
Some of Its functions are:
1. Maintaining a close liaison with RBI & GOI.
2. Maintaining a liaison with International Chamber of Commerce & Other World bodies related to Foreign Trade & Business.
3. To Circulate various policies matters & decisions related to FOREX business amongst the members.
4. Represents Indian FOREX dealers on policy matters related to FOREX dealings.
5. Maintaining of FEDAI rules regarding Transit Period, Crystallization, Forward Covers etc.. that govern all the members.
6. Other functions include approving FOREX brokers.
IMPORTANT FEDAI RULES:
1. All cancellations shall be bu Bank's opposite TT rates, TT selling rate for purchase contract & TT buying rate for sale contract.
2. In the event of delay in Payment of Interbank Foreign currency funds, Interest 2% above the prime rate of the currency of the specified Banks shall be paid by the seller Bank.
3. In event of delay in Payment of ₹. Settlement funds, Interest for delayed period 2% above NSE MIBOR ruling on each day.
4. FEDAI, also prescribes code of conduct for FOREX dealers as also guidelines with regard to dealings with FOREX brokers.
MORE IMPORTANT FEDAI RULES:
-HOURS OF BUSINESS: Left at the descretion of the Banks now. Extended business hours for dealers, if any, should be approved by respective Management.
RATES: ADs will quote exchange rates in direct terms.
All Currencies to be quoted -- /Unit of Foreign Currency = INR.
(while JPY to be quoted as 100Units of JPY=INR).
-EXPORT BILLS FOR COLLECTION: In the event of ADs delay of Payment to exporter, they will pay Interest form date of realization to the date of Actual Payment. ADs may utilize 1-3 claim to release Payment depending upon the distance/location of Branch where Payment has to be remitted.
-CRYSTALLIZATION: Unpaid Export bills should be crystallized at TT selling rate. Earlier FEDAI rule made it mandatory to crystallize unpaid demand bills 30days after the the transit & Usance Bills, 30days after the due date. However FEDAI has given the authorized dealers the freedom to decide-on the period for crystallization which may be linked to Risk Factors like Credit perception of different types of exporter clients, operational aspects etc. In case the bills are realized after crystallization, TT Buying rate is to be applied.
-IMPORTS: Unpaid Foreign Currency bills drawn under L/C will be crystallized on delay from due date at Bills Selling Rates or Contracted Rates.
-INWARD REMITTANCES: All Foreign Currency inward remittances equivalent to ₹.1 Lac should immediately be converted in Indian Rupees. Inward remittance for more than ₹.1 Lac may be converted at the request of the customer but with the permissible period. If the Payment of inward remittance is delayed, ADs will Pay Interest @ 2% over the applicable to SB A/c's after a period of 10days, for remittances up to ₹.1 Lac & for 3days after remittances for more than ₹.1 Lac..
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