What is Form A2 for Sending Money Abroad
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Form A2 is RBI’s declaration form required for all outward remittances (except for imports), including sending money overseas for education and daily expenses. It is mandatory to send money for purposes like education, medical expenses, or investments.
The trend of Study Abroad is not new, even in tier 2 and tier 3 Indian cities. Students are securing admission in universities located in the best countries to study abroad. To pursue higher education and cover the cost of living, they receive money from their parents, who are living in India.
Your parents send money to you by following the rules set by the RBI (Reserve Bank of India). At the time of sending money to you, your parents will fill up the FORM A2. It is a mandatory declaration form required when sending funds abroad from India. In this article, we will cover what Form A2 is, its importance, and other related queries.
- What is Form A2?
- Objective of Form A2
- Importance of Form A2 for Abroad Studies
- Who Needs to Submit Form A2?
What is Form A2?
Form A2 is also known as the Foreign Remittance Declaration Form. Reserve Bank of India issues this document for a selected person to make outward remittances. Consider it as an application to authorized dealers to facilitate the transfer of money abroad. Reason can be anything, like education and medical expenses.
Definition of Form A2: Form A2 is RBI’s declaration form required for all outward remittances including sending money overseas for education and daily expenses.
Objective of Form A2
The primary objective of Form A2 is to ensure that all outward remittances from India follow the rules of the Foreign Exchange Management Act (FEMA). Form A2 is also part of the Liberalised Remittance Scheme (LRS) by the Reserve Bank of India (RBI).
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It helps keep international money transfers legal and transparent. Here, we have mentioned point-wise objectives of Form A2:
- Regulatory Compliance: To declare the purpose of the remittance (Sending Money) and ensure it aligns with the permitted guidelines of the Reserve Bank of India.
- Official Records: Banks and NBFCs will have a record of such authorised remittance.
- Prevent Misuse: Helps safeguard against unauthorised or illegal fund transfers (like money laundering or funding unlawful activities).
- Monitor Foreign Exchange Outflow: This helps the RBI to track the flow of Indian currency into foreign countries.
Importance of Form A2 for Abroad Studies
You have understood what Form A2 and it's objective. Let us understand importance of this form.
- RBI Mandate: No one can send money outside India legally, without having the approval of the RBI under the Liberalised Remittance Scheme (LRS).
- Legal Compliances: When you submit a filled Form A2, banks can verify the source and purpose of remittance.
- Tax Collection: Form A2 helps banks to apply the correct rate of Tax Collected at Source (TCS). This is to ensure your payment is official and legal.
- Mandatory for Each Transaction: No matter, you are sending the money for education, healthcare or any other purpose, you need to fill up Form A2.
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Who Needs to Submit Form A2?
According to the recent policy change announced by RBI, Form A2 must be submitted by anyone sending money abroad. There is no upper or lower limit on the amount. It means, even if you want to send INR 100 outside India, you need to fill out Form A2. This ensures the remittance is being made for genuine educational needs and follows India’s foreign exchange laws.
This includes parents transferring funds for their child’s tuition, accommodation, or daily expenses while studying overseas. Students who are using their own funds or education loans for international education must also complete the form. Other than educational purposes, Form A2 is required for expenses related to medical treatment abroad, travel expenses (personal or business), gifts or donations.
Form A2 for Education Loan
Form A2 is mandatory for every single outward remittance. Even if you are borrowing an education loan. Form A2 is needed at every stage of loan disbursement. Banks and NBFCs are required to submit this form each time funds are sent to a foreign university’s account. No it’s the first or any subsequent disbursal. This ensures compliance with RBI regulations for foreign remittances.
University of Lancashire and University of Nottingham are some of the most prestigious in UK and students across the globe desire to study here. In terms of tuition fee, University of Lancashire is more affordable. However, the Uni of Nottingham is lesser selective.
A comprehensive comparison between both universities:
| Parameters | UCLan | Nottingham Uni |
|---|---|---|
| Annual Fees (MBA) | INR 14 L - 19 L | INR 21 L - 32 L |
| Acceptance Rate | 22% | 11% |
After applying to Hertfordshire University UK, the applicants are going to receive an initial decision about their application within 2-3 working days. After the submission of the application and documents, the applicants are required to pay their tuition deposit. Then, complete the Sponsorship interview and the financial declaration. International students are required to pay a deposit of £5,000 before registration. The balance can be paid in line with the liability dates related to the year and entry of the semester.
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