Best NRI accounts that can be opened without hassle
NRIs are allowed to hold three types of bank accounts and deposits in India. These accounts carry different features and, accordingly, may be suitable for different transactions.
IMPACT FEATURE April 22, 2021 | Updated 17:44 IST
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Non-Resident Indians are allowed to hold three types of bank accounts and deposits in India - NRE accounts, NRO accounts, and FCNR (B) deposits. These accounts carry different features and, accordingly, may be suitable for different transactions. Here is a summary of the features of each type of accounts:
1. NRO Account: This stands for Non-Resident (Ordinary) Account and is denominated in Indian currency. When any remittance is received in such accounts in foreign currency, such amount is converted into Indian Rupees at the prevailing exchange rates and credited to the account. Such accounts can receive remittances in foreign currency from outside India and transfer from any Indian bank account in Indian currency. One can use NRO accounts to receive income from sources within India, e.g., dividend income, investment income, rental income, etc. Similarly, an individual can use NRO accounts to receive the maturity proceeds for investments made within India. Thus, such accounts are most flexible for receiving funds, irrespective of the sources, whether from India or outside India. However, such accounts do not provide free repatriability of the account balances, and one can only transfer the funds subject to specified limits under FEMA Regulations. When the residential status changes from resident to non-resident, the existing savings and fixed deposits are converted to NRO savings and deposit accounts.