In hotels Forex means
foreign currency. This currency includes all coins, currency notes, bank
drafts, travelers’ cheque etc. of foreign countries. The Forex
regulation act (FERA) 1973 provides the basis for exchange control which
operated by R.B.I. through banks, Travel Agencies, Hotels, etc. which
are allowed to deal in FOREX. It applies to whole of India as well as to
all citizens of India residing in abroad (NRI) and branches or agencies
outside India but registered in India. Any bank or hotel or travel
agents who like to deal in Forex has to obtain license from the R.B.I.
The licenses are of two categories:
Authorized dealer in
Banks are issued the
first category of license; they are the Authorized dealers in FOREX.
They can buy and sell the foreign currency at the current rate. Hotels
are issued restricted money changer license (RLM). The hotels which
obtains this license can purchase Forex from customer and sell it to
those who are authorized dealers in Forex i.e. Banks. Such approved
hotels are entitled to use certain percentage of Forex earned by them
for the purpose of their publicity abroad, promotion tours of their
officer or agent abroad, for import of goods or equipments. Subject to
the approval of Department of Tourism (DOT) every money changer has a
minimum limit of dealing of foreign currency. If the dealing is less
than this limit then its license is canceled.
The hotels which are
license holder have to fulfill following conditions:
FOREX to be accepted
from Foreign Customers on a/c of payment of their bills.
When the foreigners pay
their bill in foreign currency the balance can be returned in Indian
Currency. If in case the guest requests the hotel that the balance can
be returned to him in foreign currency then the hotel may advise the
guest that he can use Indian currency for meeting petty expenses like
Taxi fare, or buying something from the shop, etc and balance of
Indian currency can be exchanged at the airport.
The rate of purchase of
foreign currency should be displayed near the cash counters where
money exchange business undergoes.
Foreign currency has to
be sold to authorized dealers in forex i.e. banks (on next working
Foreign currency should
be accepted not at the lower rate then the rates offered by the bank.
All purchase or sale of
foreign currency will be at the risk of the hotel.
Monthly statement of
foreign currency purchased from the guest and sold to the bank should
be submitted to R.B.I. not later then 10th of the following month in
the prescribed Performa.
There is a legal
restriction on the amount of foreign currency or traveler cheque that a
tourist may bring into India provided he makes a declaration in the
currency declaration form given to him on arrival in India. This will
enable the foreigner not only to exchange the foreign currency brought
in by him but also to take back the unspent currency out of India on
departure foreign guest are required to pay hotel bills in Forex, but
some foreign customers are exempted to pay in foreign currency.
Therefore, guest can be divided into two categories:
1. EXEMPTED GUEST: following guest are exempted to pay there
bills in forex, they can pay in Indian currency
(a) Foreign nationals employed in India earning Indian Currency
(b) Diplomatic and official guest of diplomatic institutions and
officers of United Nations and other international organizations.
(c) Nationals of those countries with which India has Rupee agreement.
You can pay or receive the money from those countries. The names of
these countries are Nepal, Bhutan etc.
(d) Employees of shipping company, Airline and the crew members
(e) Foreign nationals on a visit to India on the invitation of central
Govt. or state Govt.
(f) Foreign students studying in India on govt. of India scholarship
(g) Foreign nationals on a visit to India on the invitation of any
person resident in India.
(h) Foreign guest of exporters enjoying banking permit facility granted
2. NON EXEMPTED GUEST : Other foreign guest who do not come under
exempted category have to make payment of the hotel bill in FOREX,
payment made can be accepted from the foreign guest in one of the under
mentioned permitted currencies:
Australian Dollar 10.
Belgium Franc 11.
Danish Krone 12. German
French Franc 13.
Japanese Yen 14. Kuwait
Malaysian Dollar 15.
U.K. Pound 16. U.S.
Saudi Riyal 17. U.A.E.
Chinese Yuan 18.
It is necessary to make
clear to foreign guest that the payment of apartment (accommodation)
charge has to be made in forex. If he takes meals in the restaurant of
the hotel then he can make the payment either in foreign currency or
India Currency – it is the responsibility of the hotel to make this
point clear to the foreign guest through registration form, welcome
slip, tariff card etc. when a foreign guest makes a payment in forex the
hotel has to give ENCASHMENT CERTIFICATE to the guest whether he
asks or not. This certificate should be serially numbered and issued on
the official letter head of the hotel by the holding restricted money
changer license. A duplicate copy of it should be kept within book form
for production to R.B.I. as and when required.
The hotel has to maintain a summery book recording the Forex done within
a day in the form of foreign currency notes, travelers cheque and coins,
known as RLM book.