Module: | MODULE A: INTERNATIONAL BANKING
Q55: Consider the following statements regarding the reporting requirements for banks:
1. Banks must report LRS transactions to the Reserve Bank of India on a daily basis.
2. If a remittance is made in Euros, the bank is not required to report it against the USD limit.
3. Banks must upload the data to the XBRL (eXtensible Business Reporting Language) system.
Which of the statements given above is or are correct?
2. If a remittance is made in Euros, the bank is not required to report it against the USD limit.
3. Banks must upload the data to the XBRL (eXtensible Business Reporting Language) system.
Which of the statements given above is or are correct?
✅ Correct Answer: B
🎯 Quick Answer:
Statements 1 and 3 are correct. Statement 2 is incorrect as currency conversion is mandatory.
Concept Definition: Operational Reporting.To enforce the aggregate limit, the RBI requires granular data.Structural Breakdown: Daily Reporting: Authorized Dealer banks must upload transaction-wise information to the RBI's XBRL system on a Daily basis.This allows the central bank to track near real-time outflows.Currency Normalization: The limit is denominated in USD.Therefore, if a customer remits Euros, Pounds, or Yen, the bank must convert the amount into its USD equivalent (at the ruling exchange rate) and report that USD figure to check against the 250,000 limit.Monitoring: This reporting is crucial because a customer might hold accounts with multiple banks.Only central aggregation via PAN and Daily Reporting prevents the customer from spending USD 250,000 through each bank. Statements 1 and 3 are correct. Statement 2 is incorrect as currency conversion is mandatory.