What Is The Liberalised Remittance Scheme? (LRS)

Residents of India can use the LRS to remit up to USD250,000 per financial year.

What is the Liberalised Remittance Scheme?

The Liberalised Remittance Scheme (LRS) is part of the Foreign Exchange Management Act (FEMA) 1999 which lays down the guidelines for outward remittance from India. Under LRS, all resident individuals, including minors, are allowed to freely remit up to USD250,000 per financial year (April – March). This can be for any permissible current or capital account transaction, or a combination of both.

Easy ways to remit under LRS

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A few key things to keep in mind while remitting money abroad

If you are a resident individual, you and your family (including minors) can remit up to USD250,000 per individual, per financial year.
You cannot remit funds abroad for prohibited purposes like buying lotteries or banned magazines, amongst others.
There is no restriction on the frequency or number of transactions during a financial year. However, the total amount of foreign exchange remitted through all sources in India under LRS during the current FY should be within the LRS limit as specified by the RBI.

For further information, you can refer to our LRS FAQs.

Benefits of remittance under LRS in India

The Liberalised Remittance Scheme offers several benefits.

Diversification of investments

The LRS allows you to diversify your investments globally by investing in foreign financial assets, such as stocks, bonds, mutual funds, and real estate, thus reducing concentration risk.
Education and training

As an Indian student, you can use the LRS to pay for your education expenses abroad, including tuition fees, accommodation, and other related costs. This enables access to quality education and exposure to international learning environments.
Travel and tourism

Fund your travel expenses, including airfare, accommodation, and other travel-related costs, through the LRS. It's then easier to use foreign currency for leisure travel, business trips, medical tourism, and attending conferences or events abroad.
Medical treatment

With the LRS, you can finance your medical treatment or procedures abroad. This gives you access to advanced healthcare facilities, specialised treatments, and consultations with renowned international doctors.
Overseas gifting

The LRS can be used to gift money or assets to close relatives residing outside India. This facilitates financial support to family members and enables cross-border financial assistance.
Family support

The LRS allows you to provide financial support for the maintenance of close relatives residing outside India, helping them meet their living expenses and ensuring their well-being.

Who is eligible to remit funds outside India under the LRS?

The LRS is for residents of India as defined by FEMA. Entities such as corporations, partnership firms, Hindu Undivided Family (HUF) and trusts cannot make LRS transactions.

Permissible current account transactions under the LRS

Private visit (other than Nepal and Bhutan)
Gift or donation (including rupee gift) to a Non-Resident Indian (NRI) / Person of Indian Origin (PIO), who is a close relative
Emigration
Overseas business trip
Medical treatment abroad
Pursuing studies outside India
Going outside India for employment
Supporting close relatives abroad

Capital account transactions permissible under the LRS

Opening a foreign currency account abroad with a bank outside India
Purchase of foreign property
Investments in overseas shares, securities, mutual funds, etc
Setting up wholly owned subsidiaries or joint ventures abroad (subject to stipulated terms and conditions)
Extending rupee loans to NRIs who are relatives as defined in the Companies Act

As regulations can change, please refer to the RBI website for the most up-to-date information. Please also connect with your HSBC branch for any support and confirmation on documentation requirements for any of these transactions.

What if I need to remit more than the USD250,000 limit?

You can remit more than the limit for emigration, medical treatment and overseas education, if it's required by the country of emigration, medical institute offering treatment or the university respectively. However, this is subject to certain conditions. In other cases, you will need prior permission from the RBI to remit anything above USD250,000. Again, it's a good idea to connect with your HSBC branch for any support and confirmation on documentation requirements for any of these transactions.

What is not permitted under the LRS?

You cannot use the LRS to send money:

For any prohibited activities such as margin trading or the lottery
To buy Foreign Currency Convertible Bonds issued by Indian companies in the overseas secondary market
To trade in foreign exchange abroad
Directly or indirectly to individuals and entities identified as posing a significant risk of committing acts of terrorism as advised separately by the RBI to the banks

In addition, there may be times when you cannot use the LRS to make capital account remittances directly or indirectly to countries identified by the Financial Action Task Force as 'Non co-operative countries and territories'.

Make LRS remittance through HSBC

If you're an HSBC customer and resident of India, you can conveniently place a request for an LRS transfer through:

HSBC Internet Banking using Global View and Global Transfers or the HSBC Mobile Banking app via HSBC Global Money Transfers
Your nearest HSBC India branch

HSBC Premier customers can reach out to their Relationship Manager for any assistance.

Download the HSBC Liberalised Remittance Scheme (LRS) application here.