The licence will allow Muthoot FinCorp to undertake foreign currency exchange, issue multi-currency forex cards and facilitate remittances under the Liberalised Remittance Scheme (LRS), among other services.
It can also facilitate family maintenance and trade-related remittances, subject to applicable RBI regulations.
The company said the perpetual licence removes the requirement for periodic renewal. However, its operations will remain subject to continued compliance with the RBI’s foreign exchange regulations.
The approval is significant for the company as the RBI recently widened the scope of activities permitted for eligible AD-II entities. In May 2026, the central bank allowed eligible AD-II entities to facilitate trade-related remittances of up to ₹25 lakh and family maintenance remittances.
AD-II entities are permitted to undertake certain foreign exchange transactions but have a narrower mandate than AD-I entities, which are typically banks authorised to carry out a broader range of forex transactions.
With the expanded framework, eligible non-bank entities can participate in a larger segment of the trade and remittance business. Muthoot FinCorp said the new licence will allow it to offer these services through its existing network and set up additional authorised forex branches in line with RBI rules.The company’s forex services are aimed at customers including individuals, students travelling overseas, business travellers, NRIs and businesses. It also provides forex-related services such as currency exchange and forex cards.
The development comes as demand for foreign exchange services continues to be driven by overseas travel, education, remittances and international trade. The extent to which the new AD-II framework changes the competitive landscape will depend on the number of eligible non-bank entities entering or expanding in these segments and the regulatory conditions governing their operations.
First Published: Aug 7, 2026 11:37 AM IST
