Non Resident Indians – Products

Non-Resident Accounts can be opened and maintained by Person Resident outside India, Non-Resident Indians (NRI) and Persons of Indian Origin (PIO). Person Resident outside India means a person who is not resident in India. It also defined as a person who has gone out of India, or who stays outside India for the purpose of employment, carrying on business or vocation or for any other purpose under the circumstances indicating an uncertain period of stay. Person includes Individual, HUF, Firm, Company and Association.

Non-Resident Indian means a person resident outside India, who is a citizen of India or is a person of Indian Origin. Persons who visit India for temporary visit are treated as Non-Resident Indian. Students going abroad for studies are treated as Non-Resident Indians.

Person of Indian Origin: A Foreign Citizen (Other than citizen of Pakistan or Bangladesh) is deemed to be a person of Indian Origin if, he/she at any time held an Indian Passport or he/she or either of their Parents or Grand Parents was citizen of India by virtue of the constitution of India or Indian Citizen Act 1955 or he/she is a spouse of Indian Citizen or a person referred as above.

N R O – Non Resident Ordinary Account
Who Can Open Any NRI can open NRO account Singly or Jointly with
Residents. However, individuals / entities of Bangladesh and
Pakistan nationals require prior approval of RBI.
Nomination Nominee can be a Resident or a Non Resident.
Claim Settlement – Resident Nominees – In INR, NRI
Nominee – Repatriable to that Country as per RBI Norms.
Repatriation Remittances of Balances held in NRO accounts can be allowed
up to USD one million per financial year, for all bona fide
purposes to the satisfaction of Authorized Dealer(AD)
Foreign Tourists visiting India – the balance amount in the
account (other than local credits) can be repatriated at the
time of departure from India provided the account has been
maintained for a period not exceeding six months.
Type of account Current, Savings, Recurring, Term Deposits.
Period of Deposits As applicable to Domestic Deposits.
Rate of Interest As applicable to Domestic Deposits.
Deposit Loans As applicable to Domestic Deposits.
Foreign Currency Loans Not Permitted.
Margin As applicable to Domestic Deposits.
Interest on Dep. Loans Dep. Rate + 2 %.
Applicability of Local
Taxes		 ncluding Interest on SB Deposits, irrespective of the amount
of Interest. Wealth Tax, as applicable.
Transfer of funds Permitted to NRE account within the overall ceiling of USD one
million per financial year
Premature Cancellation
of Deposits		 As applicable to Domestic Deposits.
N R E – Non Resident External Rupee account
Who Can Open NRI can open NRE account Singly or Jointly with their resident close relatives. With regard to joint account with resident, the operation of the account should invariably be “Former or Survivor” and the former should be NRI. However, individuals / entities of Bangladesh and Pakistan nationals require prior approval of RBI.
Nomination Nominee can be a resident or a Non Resident. Claim Settlement – Resident Nominees – In Indian Rupee Non Resident Nominee – Repatriable as per RBI Norms.
Repatriation Balances in the account are Fully Repatriable.
Type of account Current, Savings, Recurring, Term Deposits.
Period of Deposits Term Deposits – Minimum one year and Maximum 10 years.
Rate of Interest Saving Deposits – Deregulated – At present 4.0 % Term Deposit – As applicable to Domestic Deposits
Deposit Loans Rupee loans to be allowed to depositor / third party without any ceiling.
Margin 15%
Interest on Loans Dep. Rate + 2 %.
Applicability of Local Taxes No TDS on Int. earned. No Wealth Tax. Free from all Taxes
Transfer of amount to other types Permitted to NRO / FCNR
Premature Cancellation Penalty 1% on premature cancellation is applicable. No Interest is payable, in case of cancellation before 1 year. Conversion from NRE to FCNR or vice versa, before maturity is subject to Penalty. No penalty in case the amount is placed in RFC.