What are foreign exchange & services associated with it?
Foreign exchange refers to the exchange of foreign currency in order to make your trade successful. Foreign exchange is the largest globalised market which facilitates the exchange of national currencies. Foreign exchange services comprise of the largest securities market by actual value, with trillions of dollars changes hands every single day.
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Most of the prominent foreign exchange services in Dubai are:
- Foreign currency traveler’s cheque
- Hedging & currency protection
- Inward/outward remittances
- Global remittance solutions
- Direct foreign remittances
- Foreign currency cash
Why do you need foreign exchange services in Dubai?
The need of foreign exchange services in Dubai arises whenever there is a simultaneous need for any foreign currency. This can be because of several reasons for instance execution of any trade deal in Dubai, payment of wages to local people in local currency will require you to get your currency converted to locally accepted currency. There are two aspects of conversion:
1- Conversion to AED
Dubai is one of the most proliferated regions amongst all the emirates of UAE, hence it also has the largest footfall across the year. United Arab Emirates Dirham (AED) is the locally accepted currency; therefore it becomes necessary to get your currency converted to AED to make certain expenses in the area.
2- Conversion of AED
Conversion of AED is required during any foreign travel or any form of direct remittance to any foreign country. This conversion is mostly by the UAE nationals to any foreign currency in case of any out-of-state settlement. This initiates the need of taking foreign exchange services in Dubai because they act as the first place of contact in any such case.
FREQUENTLY ASKED QUESTIONS (faqs)
Q What are the documents required for foreign exchange services in Dubai?
Documents required for foreign services in Dubai may vary from service to service depending on the complications attached with the services.
Documents required for Remittances
- Request Letter/FEMA Declaration (Giving the banking details of all beneficiaries)
- IE Code Certificate
- Form A1
- KYC Report
- Transport documents in original/ copy
- Bill of Entry (Exchange Control Copy) (Original)
- Original License (Exchange control copy), if applicable.
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Documents required for Import collection
- Request Letter/ Debit Authority/ OGL/ FEMA Declaration
- IE Code Number Certificate
- Form A1
- KYC Report
- Bill of Entry Declaration
Documents required for Letter of credit (L/C)
- Letter of credit Application Form
- General Undertaking/ Indemnity bond.
- Board Resolution of Companies/ Partnership Deed of Firms
- IE Code Certificate
- FEMA Declaration
- KYC Report
- Purchase Order/ Performa Invoice
- Original License (Exchange control copy), if applicable
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Chartered Accountant by profession, CA Sanket Agarwal has an experience of above11 years in Cross Border compliance , Import Export , International Taxation & is a passionate content creator.