What Is The Full Form Of FEMA In Banking?
FEMA full form in banking is Foreign Exchange Management Act. This was a big move from the Indian government to keep a handle on foreign exchange dealings and manage the bucks they’ve got stashed away in foreign exchange reserves. It’s a key piece of legislation that gets bankers’ pulses racing. Its mission is to grease the wheels of external trade and payments, keep the foreign exchange market in tip-top shape, and look out for the stability of India’s home currency, the Indian Rupee (INR). Back in 1999, it showed the older Foreign Exchange Regulation Act (FERA) the door, promising a modern, liberal approach to all things foreign exchange in India.
What Else Should You Know About FEMA?
FEMA’s got the Reserve Bank of India (RBI) in its corner, making sure foreign exchange dealings are above board. The RBI has the power to lay down the law on everything foreign exchange – they’re the ones pulling the strings to make sure things go smoothly, transparently, and by the book. FEMA’s umbrella covers a whole lotta ground, one of them being Current Account Transactions. Think of these as the bread-and-butter transactions that happen every day like trade in goods and services, remittances, travel, and other payments. FEMA’s got a pretty chill attitude towards these transactions, most of them can go down without much fuss.