International Banks Closing Accounts: International banks are no longer liking the money of the Indian rich. RBI’s new rules have tightened the screws on Indian rich people for sending too much money abroad. Due to this, the banks which were once filled with Indian money are no longer happy with the small amount of money coming in. Recently, two British banks, one Swiss and one UAE bank have requested about two dozen Indians to close their accounts.
Foreign banks’ interest in Indian money decreased
The LRS (Liberalised Remittance Scheme) of the central bank RBI (Reserve Bank of India) has reduced the interest of foreign banks in Indian money. That’s why big banks are now staying away from the accounts of Indian rich people. How does RBI crack down on keeping funds abroad without any reason? Due to this, foreign banks are not able to make profits. These international banks require foreign clients to maintain a higher minimum balance. But, Indian clients are no longer able to do this. That’s why many big banks are closing their accounts.
Accounts of about two dozen Indians closed in 2 months
According to the report of Economic Times, accounts of about two dozen Indians have been closed in the last two months. This information has been given to these rich by tax advice and service providers. Under RBI’s LRS, Indians can send 2.5 lakh dollars abroad in a year. This money can be used to buy stocks or property and take care of family members.
Minimum balance in many foreign banks is 10 lakh dollars
On the other hand, the minimum balance in many foreign banks has been made 10 lakh dollars. Therefore, now these banks have started hesitant in keeping the money of Indians. Foreign banks use this minimum balance to earn money by investing in many places including stocks. But, due to the new scheme of RBI, now foreign banks are not able to invest the money of Indians and they are not able to earn income.
Indians are buying property by sending money
Indians have mostly bought property with the money sent under LRS in these banks and have also given this money to their family members. Therefore, these foreign banks have asked Indians to indicate any other account to which the outstanding money can be sent and the account can be closed. E-mails have been sent to account holders in this regard. According to the new rules of RBI, if money is lying in a foreign account then it will have to be brought back. Singapore Bank has also made a similar appeal to its customers. Foreign banks do not want to operate low balance accounts.
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