Your client in the US pays $2,000. The bank converts it to rupees the day it lands, at its own rate, and you never get a say. A freelancer who earns in dollars every month starts to ask whether there is a way to receive and hold the foreign currency itself. There is one, and the Reserve Bank of India has rules for it. It is not a place to park dollars indefinitely, and the details matter.
An EEFC (Exchange Earners' Foreign Currency) account is a foreign-currency current account held with an authorised dealer bank in India, where a resident who earns foreign exchange can credit 100 percent of it. It pays no interest on the balance. Each month's credits must be converted to rupees by the end of the following month, after approved uses. This post explains who can open one, what can be credited and spent, and why it is not a savings pot for dollars.
An EEFC account is a no-interest current account at an Indian bank
RBI's Master Direction on deposits and accounts says a person resident in India may open an EEFC account with an authorised dealer bank under the conditions in the foreign currency account regulations. It is a current account only, not a savings or fixed deposit account, and it earns no interest. No loan or credit may be given against EEFC balances. ICICI Bank's EEFC page says resident individuals can open one. Ask your own bank about its process, as terms and charges differ.
You can credit all your foreign exchange earnings through banking channels
RBI's direction allows 100 percent of foreign exchange earnings received through normal banking channels to be credited, other than loans and investments. RBI's FAQ on foreign currency accounts lists export earnings, advance remittances received by an exporter, and professional earnings received for services rendered in an individual capacity, such as consultancy fees. The money must come in through a bank, which is also what your GST export treatment needs, as the guide on LUT and GST for freelance exports explains.
Convert each month's credits by the end of the next month
This is the rule that surprises people. RBI's direction says the total of accruals in the account during a calendar month should be converted into rupees on or before the last day of the following calendar month, after adjusting for approved uses and forward commitments. A credit in October must therefore be converted by 30 November, net of approved uses. So an EEFC account gives you a short window to choose when to convert, not a way to hold dollars as an investment.
Permitted debits include payments abroad for permitted current or capital account transactions, and withdrawals in rupees. Rupees withdrawn cannot be put back into the account. If you pay for foreign software, a conference or a contractor abroad, you can pay straight from the dollars instead of converting and paying again, which saves a conversion.
A foreign fintech balance is not an EEFC account
Balances on platforms such as Wise, Payoneer or PayPal are not EEFC accounts and do not carry its rules, and each platform sets its own limits for Indian residents. Ask your bank how such balances should be treated before you rely on one as a place to hold dollars. The guide to currency risk for freelancers covers managing the swing in a lawful way.
The export realisation period is separate
Separately from the EEFC conversion rule, RBI's export regulations require export proceeds to be realised and repatriated within nine months of the invoice date for services, or twelve months where the export is invoiced or settled in rupees, from 1 October 2026. The bank can extend the period on request, and for invoices dated before that date you should ask your bank which period applies. For GST, the IGST Act requires payment for an export of service in convertible foreign exchange, or in rupees where RBI permits, so keep the bank trail. The guide to FIRC versus FIRA covers the documents.
Tax and exchange rates are a separate matter
Holding dollars in an EEFC account does not change how the income is taxed. The GST value of an export invoice follows Rule 34(2), and income tax conversion follows Rule 115, as the guide on the exchange rate on a GST export invoice explains. Ask your CA how exchange differences are treated in your books.
Choose your bank account structure deliberately
Whether an EEFC account is worth opening depends on how often you pay for things abroad and how much you earn in foreign currency. Rinto lets you mark invoices paid and always know who owes you what, which helps you reconcile foreign receipts to client invoices. Rinto does not open or manage bank accounts. The guide to a business bank account for freelancers covers the domestic side. This post is general information, not financial or legal advice, and your bank can explain its own terms.
Frequently Asked Questions
What is an EEFC account and who can open one?
An EEFC (Exchange Earners' Foreign Currency) account is a foreign-currency current account with an authorised dealer bank in India. A person resident in India who earns foreign exchange can open one under RBI's foreign currency account regulations, and RBI's FAQ lists export earnings and professional earnings in an individual capacity as permitted credits. It pays no interest and no loan can be taken against it. Banks have their own processes, so ask yours about eligibility and charges. Banks set their own application steps and charges, so ask yours for the form and fee list.
How much of my foreign income can I credit to an EEFC account?
RBI's direction allows 100 percent of foreign exchange earnings received through normal banking channels to be credited, other than loans and investments. The money must come in through a bank, so keep the remittance advice and the invoices together. Your bank may also ask for evidence that the money is a genuine export or professional earning, which is the same trail you need for GST. Keep the foreign remittance advice and the invoice together, since your bank may ask for both.
How long can I keep dollars in an EEFC account?
Not indefinitely. RBI's direction says each calendar month's accruals should be converted to rupees on or before the last day of the following month, after adjusting for approved uses and forward commitments. A credit in October must be converted by 30 November, net of approved uses. The account gives you a short window to choose when to convert and to pay for permitted things abroad directly in dollars. It is not a savings or investment account. If you pay a foreign tool or contractor in dollars, you can pay straight from the account.
Does an EEFC account pay interest?
No. RBI's direction says the account is in the form of a non-interest-bearing account, and it is a current account only, not a savings or fixed deposit account. No fund-based or non-fund-based credit can be granted against EEFC balances. If you want a return on idle money, an EEFC account is the wrong tool, since the monthly conversion rule also limits how long money can sit there. Ask your bank about its charges before you open one. Treat it as a payments tool, not a place to earn a return.
What is the export realisation period for freelancers from October 2026?
Under RBI's export regulations in force from 1 October 2026, export value for services must be realised and repatriated within nine months of the invoice date, or twelve months where the export is invoiced or settled in rupees. The bank can extend the period on request. This is separate from the EEFC monthly conversion rule. Keep the invoice, remittance advice and any FIRC or FIRA together, and ask your bank if a payment is running late. For invoices dated before that date, ask your bank which period applies.