FIRMS Portal: Recent changes and practical difficulties

In the year 2018, the Reserve Bank of India changed the paradigm by shifting most of its filings to web-based forms which were earlier done in physical form/by submitting hard copies of the forms and supporting documents. These portals were FIRMS and FLAIR. After four years of the launch of FIRMS portal in 2018, the Reserve Bank of India closed its FIRMS portal for SMF filings from December 22, 2022 to January 04, 2023 for introducing some changes. On January 04, 2023, it released its circular no. RBI/2022-23/160 [A.P. (DIR Series) Circular No. 22 (Click Here) mentioning the changes implemented on the FIRMS portal with respect to the reporting of foreign investment in SMF.

Salient features of the changes made on the FIRMS portal are as follows

1. All forms submitted with the requisite documents will be auto-acknowledged on the FIRMS portal with a time stamp and an auto-generated e-mail will be sent to the applicant.
2. The AD banks have to verify the submitted forms within five working days based on the uploaded documents.
3. For forms filed with a delay of less than or equal to three years, the AD banks will approve the same, subject to payment of Late Submission Fee ("LSF").
4. The LSF will be computed by the system and an e-mail will be sent to the applicant and the concerned Regional Office (RO) of RBI specifying the amount and the timeline within which it is to be paid to the concerned RO of RBI.
5. Once the LSF amount is realised, the concerned RO will update the status in the FIRMS portal and the updated status will be communicated to the applicant through a system generated e-mail, which can also be viewed in the FIRMS portal.
6. The AD bank will approve the forms filed with a delay greater than three years, subject to the compounding of contravention. The applicant may thereafter approach RBI with their application for compounding.
7. The remarks of the AD Bank for rejection of forms, if any, will be communicated to the applicant through a system-generated e-mail and the same can also be viewed in the FIRMS portal.

The Reserve Bank of India recently on September 30, 2022, vide its circular no. RBI/2022-23/122 A.P. (DIR Series) Circular No.16, revised the LSF (Click Here). The revised LSF structure is as below:

Where:

1. "n" is the number of years of delay in submission rounded upwards to the nearest month and expressed up to 2 decimal points.
2. "A" is the amount involved in the delayed reporting.
3. LSF amount is per return.
4. Maximum LSF amount will be limited to 100 per cent of 'A' and will be rounded upwards to the nearest hundred.

The use of technology for compliance filings is not a new thing in India. Many authorities like the Finance Ministry, Ministry of Corporate Affairs, MSME and Startup filings are already done in online mode. It was indeed a welcoming step by the Reserve Bank of India to shift the filings to the online mode. However, after working on FIRMS portal for 4 years and in view of the recent changes, a few more features are expected to be added to the portal.

Downloading of forms filed on FIRMS portal

The forms available on FIRMS portal are web-based forms, which can be filled up, submitted and viewed after logging into the Business User Account of the user. These forms are not available for downloading by the user for sharing and keeping in record purposes. If the forms have to be shared, the user has to take screenshots of each tab and save them to a word file as the password of the Business User account can't be shared with everyone.

How convenient it would be if the forms-drafts or approved ones can be downloaded and can be stored for records.

The FLAIR portal of the RBI allows downloading of the FLA returns.

Downloading of Acknowledgements

Once the filed forms are approved, the approval email is sent to the registered email ids with remarks and the remarks are also mentioned in the column of the filled and approved form. The remarks can be read by logging into the Business User account of the entity/person. Again, just like forms, acknowledgements also cannot be downloaded. If the user wants to share, they have to forward the email received from the Bank.

When fillings were done in hard copies, the entities used to get acknowledgement of the filings and approval letter which can be stored and looks authenticated. In my opinion, the email text while forwarding can be edited and a simple email does not look authenticated.

FLAIR portal of the RBI allows downloading of the acknowledgements.

Comprehensive list of documents to be submitted

FIRMS portal has a 'User Manual for SMF FIRMS Application' which contains the lists and formats of the documents required to be submitted along with the specified forms. However, AD Bank have many other requirements which are not listed in the manual and formats are not provided anywhere. This leads to multiple rejections. This also leads to ambiguity as every AD Banks have their own set of list to approve the forms.

The Reserve Bank of India may provide a comprehensive list of documents and drafts thereof in the manual to bring unanimity.

Challan acknowledging the payment of LSF

While making payments on the other compliance portals, like mca.gov.in, Bharatkosh, etc. the user gets a challan copy. In the case of FIRMS, for payment of LSF, the user does not get any challan. The LSF is intimated to the user by way of an automated mail and the payment is done on the counter of the Reserve Bank of India.

Online mode of payment of LSF

The FIRMS portal does not allow the user to pay LSF by online modes like net banking, UPI, or Credit/Debit  Card. The user has to submit a Demand Draft on the counter of the Reserve Bank of India to pay the LSF. In the view of digital India, adding the feature of online payment on FIRMS portal is very much required. It will not only make the payment of LSF quick but also easily traceable which in turn can help to promptly link it with the form's status.

All the above-mentioned points are related to the practical difficulties faced by the users and if added to the FIRMS portal can lead to ease of compliance filings.

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