RBI widens SNRR account scope to IFSC branches and mandates purpose-capture for non-resident transfers
AD banks must capture a stated purpose before effecting non-resident-to-non-resident SNRR transfers, and may now hold SNRR accounts at IFSC branches.
Change
On 18 June 2026, the Reserve Bank of India (RBI) issued the Foreign Exchange Management (Deposit) (Sixth Amendment) Regulations, 2026, amending the 2016 Deposit Regulations to extend Special Non-Resident Rupee Account (SNRR account) eligibility to authorised dealer branches in International Financial Services Centres (IFSCs) and to require AD banks to record a stated underlying purpose before effecting SNRR transfers between two persons resident outside India.
Why it matters
The amendment changes two things AD banks must operationalise. First, SNRR account scope now expressly includes AD branches in IFSCs, and Schedule 4 paragraph 1 is rewritten to define the permissible-transaction perimeter for those accounts. Second, new Schedule 4 paragraph 16 imposes a mandatory documentation control: SNRR-to-SNRR transfers between persons resident outside India must be effected only on an account-holder instruction stating the underlying purpose. The amendment also opens NRO-to-SNRR and transfers to NRE/SNRR accounts subject to the limit in Regulation 4 of the Remittance of Assets Regulations, 2016, which AD banks must enforce on those transfers.
Implications
- — Authorised dealer banks offering SNRR accounts must update onboarding SOPs and account-scope mapping to reflect that SNRR accounts may now be held at AD branches in IFSCs under the substituted regulation 5(4) and Schedule 4 paragraph 1 — eligibility mapping that excludes IFSC branches is now out of date.
- — Authorised dealer banks' payments and compliance teams must capture and retain an account-holder instruction stating the underlying purpose before effecting any SNRR-to-SNRR transfer between persons resident outside India — effecting such a transfer without that recorded purpose breaches new Schedule 4 paragraph 16.
- — Authorised dealer banks' remittance-control teams must apply the limit in Regulation 4 of the Foreign Exchange Management (Remittance of Assets) Regulations, 2016 when processing NRO-to-SNRR and NRE/SNRR transfers — processing beyond that limit contravenes the amended Schedule 1 and Schedule 3.
Who is affected
- — Authorised dealer banks' account-onboarding teams
- — Authorised dealer banks' payments and compliance teams
- — Authorised dealer banks' remittance-control teams