The central bank is open to looking at increasing the limit on international e-commerce transactions from $3,000 at present says RBI executive director G Padmanabhan
Mumbai: The Reserve Bank of India (RBI) is open to looking at increasing the limit on international e-commerce transactions currently set at $3,000, reports PTI quoting a top official.
"If the system wants the limit to be enhanced, that is something that we are positively inclined to look at," Reserve Bank executive director G Padmanabhan said on the sidelines of a CII event.
Padmanabhan said the limit was set in consultation with PayPal, a major player among the international payment gateways, and added that as many as 99% of the e-commerce transactions fall under the limit of $3,000.
Giving rationale for setting the limit (there are no limits for domestic e-commerce transaction) he said it is needed in a country like India which has exchange controls.
To a question on extending trading hours in the forex market beyond 1700 hours, the RBI official said it is difficult to relax as "we do not have full capital account convertibility".
"Most of the currency markets which work beyond a reasonable time are the markets which are capital account convertible, where in case there is a liquidity concern, you can source the money from some other country or currency," he said.
"As long as we have certain capital account controls, or as long as we think liquidity has to be provided within the system, then we have to work within certain time limits," he said, adding considering the needs of trade, the RBI is conscious of the fact that there is a need to relook at it.
When asked about the volatility in the rupee and how domestic businesses, especially the smaller ones should cope with it, Padmanabhan said we have to learn to live with the fluctuations and opined that the only way it can be handled is through hedging of cash flows.
Inside story of the National Stock Exchange’s amazing success, leading to hubris, regulatory capture and algo scam
Fiercely independent and pro-consumer information on personal finance.
1-year online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.
Fiercely independent and pro-consumer information on personal finance.
30-day online access to the magazine articles published during the subscription period.
Access is given for all articles published during the week (starting Monday) your subscription starts. For example, if you subscribe on Wednesday, you will have access to articles uploaded from Monday of that week.
This means access to other articles (outside the subscription period) are not included.
Articles outside the subscription period can be bought separately for a small price per article.
Fiercely independent and pro-consumer information on personal finance.
Complete access to Moneylife archives since inception ( till the date of your subscription )
