Mumbai: While further liberalising its overseas remittance scheme, the Reserve Bank on Tuesday hiked the transaction limit for individual investors to 1,00,000 dollars in a year—a development that would lead to increased participation of Indians in foreign markets.
The decision has come as a major boost for companies like Reliance Money, which has already tied up with UK-based online trading platform provider CMC Markets to provide offshore investment products to Indian customers.
Besides, a number of other financial services providers and brokerages are expected to soon follow with similar products and tie-ups to tap Indian investors seeking to invest in foreign equity, commodities and derivatives markets.
Measures like enhancing the current or capital transaction limit for individuals by 50,000 dollars and increasing the limit of overseas investments by mutual funds are steps in the right direction to achieve the goal of full capital account convertibility, PHDCCI President Sanjay Bhatia said in a statement.
Like individuals, mutual funds would also be able to invest funds to the tune of 4 billion dollars in overseas avenues, from an earlier cap of 3 billion dollars.
This would benefit the Indian MF industry by providing them with a greater opportunity for investments abroad as well hedge risks of volatile domestic equity markets.
According to the liberalised remittance scheme, RBI has allowed Indian residents to remit up to 1,00,000 dollars per financial year, from 50,000 dollars previously, for any current or capital account transaction or a combination of both.
Through its exclusive tie-up with CMC Markets, the world leader in online derivative trading, Anil Ambani Group company owned Reliance Money provides opportunity to its customers to buy offshore products like foreign equity, commodities and currency under the RBI prescribed limits.
CMC Markets claims of providing investment opportunity in over 1,000 instruments, across 18 global markets and 100 countries with total transaction worth over 1 trillion dollars recorded over the last two years.
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