Card-based overseas forex trading banned

The RBI has directed banks to close cards or accounts of resident Indians using overseas forex trading.

“When a bank comes across any prohibited transaction undertaken by its credit card or online banking customer, the bank will immediately close the card or account of the defaulting customer,” said RBI.

This is a follow up of its earlier circular warning banks and customers against internet /electronic trading portals luring the residents with offers of guaranteed high returns. The size of the market is not known.

“Some companies have reportedly engaged agents who contact people to undertake forex trading and entice them with promises of disproportionatereturns,” RBI had said earlier.