Muthoot FinCorp Secures Perpetual RBI AD-II Forex Licence; Adds Trade and Remittance Services

Muthoot FinCorp has received a perpetual Authorised Dealer Category-II (AD-II) foreign exchange licence from the Reserve Bank of India (RBI), as per The CNBC TV18 news report. 

The approval allows the non-banking financial company to carry out a wider range of permitted foreign exchange activities without requiring periodic licence renewals.  

The company noted that its operations will continue to remain subject to RBI's foreign exchange rules and regulatory compliance. 

Services to Cover Remittances and Forex 

Under the licence, Muthoot FinCorp can undertake foreign currency exchange, issue multi-currency forex cards and facilitate remittances under the Liberalised Remittance Scheme (LRS).  

It is also permitted to handle family maintenance remittances and eligible trade-related remittances within the limits prescribed by the RBI.  

The services are to cater to individuals, students travelling overseas, business travellers, non-resident Indians (NRIs) and businesses that require foreign exchange facilities. 

Approval Follows RBI Policy Change 

The licence comes after the RBI revised the scope of activities for eligible AD-II entities in May 2026. The updated framework allows such entities to facilitate trade-related remittances of up to ₹25 lakh, in addition to family maintenance remittances. 

AD-II entities are authorised to undertake specified foreign exchange transactions. However, their scope remains narrower than that of AD-I entities, which are mainly banks permitted to offer a broader range of foreign exchange services. 

Branch Network to Support Rollout 

Muthoot FinCorp noted that the newly permitted services will be offered through its existing branch network. The company also plans to establish additional authorised forex branches in accordance with RBI guidelines.  

It already provides currency exchange and forex cards, and the new approval adds more regulated remittance services to its existing offerings. 

Demand for foreign exchange services in India has remained supported by overseas education, international travel, inward and outward remittances, and cross-border trade, prompting regulatory changes to expand participation by eligible non-bank entities. 

Read More: Bajaj General Insurance Partners with Swiss Re for Commercial Collaboration! 

Conclusion 

With the permanent AD-II licence in place, Muthoot FinCorp can offer additional remittance and forex services permitted by the RBI. The approval also removes the requirement for periodic licence renewals. 

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