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Bank Promotion Exam Guide

Banking Awareness | Banking Knowledge | for all Bank Exams

Module: General Practice

Q71: Which of the following accurately describes the primary functional difference between an Authorized Dealer (AD) Category-II and an Indian Agent under the Money Transfer Service Scheme (MTSS)?

A
AD Category-II can only handle inward remittances, while MTSS Agents can handle both inward and outward remittances.
B
AD Category-II can handle outward remittances (for specified purposes), whereas MTSS Agents are restricted only to inward personal remittances.
C
MTSS Agents are required to have higher Net Owned Funds (NOF) than AD Category-II entities.
D
There is no functional difference; the terms are used interchangeably.
✅ Correct Answer: B
1. AD Category-II: These entities are authorized to release/remit foreign exchange out of India for private purposes (Medical, Education, Travel). They can also handle inward remittances.
2. MTSS (Money Transfer Service Scheme): This is a specific framework for "Personal Remittances" from abroad to India (e.g., Western Union, MoneyGram). Indian Agents under MTSS are strictly prohibited from allowing outward remittances.
They only receive money and disburse it to beneficiaries in India.
3. The Distinction: AD-II = Two-way flow (Non-trade); MTSS = One-way flow (Inward only).