Module: General Practice
Q55: According to the extant RBI Master Direction on Money Changing Activities, what is the minimum Net Owned Funds (NOF) required for an entity to apply for a Single Branch Full Fledged Money Changer (FFMC) license?
✅ Correct Answer: B
The Net Owned Funds (NOF) requirement serves as a capital buffer to ensure the financial health of the applicant.
1. Single Branch FFMC: The minimum NOF required is ₹25 Lakh.
2. Multiple Branch FFMC: The minimum NOF required is ₹50 Lakh.
3. Concept Definition: NOF is calculated as (Paid-up Equity Capital + Free Reserves + Credit Balance in P&L) minus (Accumulated Losses + Deferred Revenue Expenditure + Intangible Assets). 4. Context: These limits must be maintained on an ongoing basis.
If an FFMC's NOF falls below the minimum, they must report it to the RBI.
1. Single Branch FFMC: The minimum NOF required is ₹25 Lakh.
2. Multiple Branch FFMC: The minimum NOF required is ₹50 Lakh.
3. Concept Definition: NOF is calculated as (Paid-up Equity Capital + Free Reserves + Credit Balance in P&L) minus (Accumulated Losses + Deferred Revenue Expenditure + Intangible Assets). 4. Context: These limits must be maintained on an ongoing basis.
If an FFMC's NOF falls below the minimum, they must report it to the RBI.