Exchange Earners Foreign Currency (EEFC) Account

An Exchange Earners' Foreign Currency (EEFC) Account is a non-interest-bearing current account in foreign currency offered by authorised dealer Category-I banks in India. It allows individuals and entities who are residents in India, including exporters, who earn foreign exchange to hold 100% of their foreign exchange earnings without immediate conversion to Indian Rupees and vice-versa, thereby helping to manage currency fluctuation risks and reduces conversion costs, while allowing seamless transactions in foreign currency for permissible purposes.

All categories of foreign exchange earners who are resident in India, including individuals, companies, such as exporters, are eligible to open an EEFC account. Exporters may require a valid Importer-Exporter Code (IEC). However, entities operating in Special Economic Zones (SEZs) are not eligible to maintain EEFC accounts.
 

100% foreign exchange earnings can be credited to the EEFC account. However, the total accruals in the account during a calendar month should be converted into INR on or before the last day of the succeeding calendar month, after adjusting for any utilisation of the balance for approved purposes or forward commitments
 

 

  • EEFC Accounts can currently be opened in three currencies: USD, EUR, and GBP
  • EEFC accounts will be opened in accordance with the Bank’s KYC Procedural Manual, as updated from time to time.
  • Account Opening Form (AOF) for Non-Individual entities will be used for opening current account shall be used EEFC account. KYC documents to be in line with the constitution of the customer as per the bank's KYC Procedural Manual. 
  • The account opening process will follow the Bank’s Process Manual for Account Opening and Deliverables Management.

Additional KYC Documents: 

  • Board resolution in case of company / Account opening letter - should mention the Foreign Currency in which the account is to be opened.
  • Import Export Code (IEC) Certificate, is required to be obtained (if applicable). 

Statement of Accounts: 

  • The Bank provides both email and physical account statements; however, no passbook will be issued for accounts under this.
  • Physical statements will be sent to the registered mailing address & email statements will be sent to the registered email ID. 
  • Monthly email statements will be provided free of charges. 

Account Closure 

  • EEFC accounts can be closed basis request letter from client. 
  • The closure process will follow the standard procedure for Current Account closure.
  • All residual balances will be converted and credited to customer’s current account before closure. 

Turn Around Time (TAT) for Account Activation: The TAT for EEFC A/c activation will be T+3 working days; whereby T is determined from the time file for account opening activation 
 

Permissible credits

  • Inward remittance through normal banking channels, other than remittances received on account of foreign currency loan or investment received from abroad or received for meeting specific obligations by the account holder;
  • Payments received in foreign exchange by a 100 per cent Export Oriented Unit or a unit in (a) Export Processing Zone or (b) Software Technology Park or (c) Electronic Hardware Technology Park for supply of goods to similar such units or to a unit in Domestic Tariff Area;
  • Payments received in foreign exchange by a unit in the Domestic Tariff Area for supply of goods to a unit in the Special Economic Zone (SEZ);
  • Payment received by an exporter from an account maintained with an authorised dealer for the purpose of counter trade. (Counter trade is an arrangement involving adjustment of value of goods imported into India against value of goods exported from India in terms of the Reserve Bank guidelines);
  • Advance remittance received by an exporter towards export of goods or services;
  • Professional earnings including directors’ fee, consultancy fee, lecture fee, honorarium and similar other earnings received by a professional by rendering services in his individual capacity;
  • Re-credit of unutilised foreign currency earlier withdrawn from the account;
  • Amount representing repayment by the account holder's importer customer in respect of trade related loan/advances granted by the exporter (subject to compliance with the extant guidelines) holding EEFC account; and
  • The disinvestment proceeds received by the resident account holder on conversion of shares held by him to ADRs/GDRs under the Sponsored ADR/GDR Scheme approved by the Foreign Investment Promotion Board of the Government of India.
  • Payments received in foreign exchange by an Indian start-up arising out of sales/ export made by the start-up or its overseas subsidiaries. 
    For the purpose of this sub-regulation a ‘start-up’ will mean an entity recognised as a start-up by the Department for Promotion of Industry and Internal Trade pursuant to notification number G.S.R. 127(E) dated February 19, 2019, and as amended from time to time.
  • Payment received for export of goods and services from India, out of funds representing repayment of State Credit in U.S. Dollar held in the account of Bank for Foreign Economic Affairs, Moscow, with an authorised dealer in India;

Permissible debits:

  • Payment outside India towards a permissible current account transaction [in accordance with the provisions of the Foreign Exchange Management (Current Account Transactions) Rules, 2000] and permissible capital account transaction [in accordance with the Foreign Exchange Management (Permissible Capital Account Transactions) Regulations, 2000].
  • Payment in foreign exchange towards cost of goods purchased from a 100 percent Export Oriented Unit or a Unit in (a) Export Processing Zone or (b) Software Technology Park or (c) Electronic Hardware Technology Park
  • Payment of customs duty in accordance with the provisions of the Foreign Trade Policy of the Central Government for the time being in force.
  • Trade related loans/advances, extended by an exporter holding such account to his importer customer outside India, subject to compliance with the provisions of FEMA and the rules/ regulations made thereunder (including the Foreign Exchange Management (Borrowing and Lending in Foreign Exchange) Regulations, 2000)
  • Payment in foreign exchange to a person resident in India for supply of goods/services including payments for airfare and hotel expenditure.
  • Exporters can repay packing credit advances, whether availed of in Rupee or in foreign currency, from balances in their EEFC account to the extent exports have actually taken place.
  • Balances held in the EEFC account may be credited to NRE/ FCNR (B) Accounts, at the option/request of the account holder consequent upon change of their residential status from resident to non-resident.
     

 

  • Non-interest Bearing: EEFC accounts do not earn interest.
  • Limited Retention Period: Unused balances generally need to be converted to INR by the end of the month following the credit, though exceptions exist for approved purposes *
  • (refer Q3 above)
  • Non-eligible Transactions: 
    • Certain foreign currency receipts, such as loans or investments, cannot be credited to the A/c. 
    • Funds converted to INR and withdrawn cannot be re-credited.
  • Fund-based/non-fund-based credit facilities cannot be granted against the balances held in EEFC Accounts.

  • Non-interest-bearing current account.
  • No minimum balance required.
  • Cash transactions are not permitted
  • No Debit Card/ATM Card will be issued.
  • Cheque facility is not available for EEFC account.
  • Internet Banking Facility is view only. Customers will not be permitted to perform any transactions through Internet Banking for this account. 

 

  • Avoids double conversion costs: Funds can be held in foreign currency, reducing the need for repeated conversion between INR and foreign currency for overseas payments.
  • Mitigates exchange rate risk: Customers can convert foreign currency to INR when exchange rates are more favourable, however, this is subject to regulatory guidelines on mandatory conversion.
  • Simplifies international transactions: The account facilitates direct foreign currency payments for approved expenses.
  • Facilitates international transactions: Holding multiple foreign currencies aids in efficient international transactions.
  • Supports working capital management: The account provides a buffer against currency volatility.

Yes, balances can be hedged using forward contracts. Funds sold forward must be earmarked for delivery, and such contracts can be rolled over according to the RBI.

Yes, resident individuals may include resident relatives ([as defined in section 2(77) of the Companies Act, 2013] as joint holders on a "former or survivor" basis.

Yes, a customer may transfer EEFC balances from their EEFC account held in the same name from a different bank to Bandhan Bank. In such cases, the remitting bank must provide SWIFT/ SFMS confirmation with the following details:

  • The date of credit for each tranche of the remittance.
  • Confirmation that none of the remittances have exceeded the M+1* regulatory criteria.

*last forex working day of the next month

Yes. Customers may request the transfer of their EEFC balances to an EEFC account in the same name at another bank. Only balances that fall within the M+1 regulatory criteria can be transferred. Bandhan Bank will share SWIFT/SFMS confirmation with the receiving bank, including:

  • The date of credit of each tranche of remittance. 
  • Confirmation that none of the remittances have exceeded regulatory M+1* criteria. 
  • A request letter from the customer specifying details and the reason for transfer.
  • All transactions will be routed through Nostro Account

*last forex working day of the next month

Bandhan Bank offers EEFC Accounts in three currencies: USD, GBP, and EUR.

A customer may open only one EEFC Account per currency.
However, they may hold multiple EEFC Accounts as long as each is in a different currency.

No. EEFC Accounts are current accounts and do not earn interest.

No. SEZ units cannot open an EEFC Account.

However, an SEZ unit may open a foreign currency account with an Authorized Dealer (AD) in India, subject to the conditions specified in Regulation 4(D) of the Foreign Exchange Management Regulations dated January 21, 2016.

Yes. Foreign exchange earnings received through an international credit card, where the reimbursement is made in foreign currency, are treated as remittances through normal banking channels and same can be credited to the EEFC Account.

No, there is no restriction on withdrawing funds in INR from an EEFC account. However, once the amount is withdrawn in INR, it cannot be reconverted into foreign currency or re-credited to the EEFC Account.

Yes, EEFC balances can be hedged. When the balance in the account is sold forward by the account holder, it must remain earmarked for delivery under the forward contract. However, such contracts can be rolled over as per applicable regulations.