CTR in banking stands for Currency Transaction Report. This is a crucial document that financial institutions must file with the relevant Financial Monitoring Unit (FMU).
Currency Transaction Report (CTR) Explained
A CTR is a threshold-based report that details cash transactions exceeding a specified limit. This limit varies by jurisdiction. According to the provided reference, in some places, it involves transactions of two million rupees or more.
- Purpose: To detect and prevent money laundering and other financial crimes.
- Trigger: Cash transaction exceeding a pre-defined threshold.
- Involves: Payment, receipt, or transfer of cash.
- Filed by: Reporting entities (banks, financial institutions).
- Filed with: Financial Monitoring Unit (FMU).
Key Aspects of CTR
Here's a breakdown of important elements related to CTR:
| Feature | Description |
|---|---|
| Transaction Type | Primarily cash transactions. |
| Threshold | Varies by country and regulations (e.g., two million rupees or above). |
| Reporting Entity | Banks, credit unions, and other financial institutions. |
| Regulatory Body | Financial Monitoring Unit (FMU) or equivalent. |
| Information Included | Customer details, transaction amount, date, and other relevant information. |
Example
Imagine a customer deposits two and a half million rupees in cash into their bank account. Because this exceeds the two million rupee threshold (as stated in the reference), the bank is required to file a CTR with the FMU. This report includes information about the customer, the transaction, and the source of the funds, if known.
