Can an NRI open a joint account with a resident?
Yes. An NRI can open a joint account with a resident but only on “former or survivor” basis and that too only for a NRO Account. The term “former or survivor” basis refers to the condition where only one of the two joint account holders, “Former” can operate the account. The “Survivor” can only operate the account after the “Former” expires.
To understand it in a more simpler way, let’s take an example, if you are an NRI and you open a joint NRI Account with your father who is a resident of India. You will be the ‘Former” account holder and your father will be the “Survivor”. Now, only you will be able to operate the account as long as you are alive. Your father can only operate the account after your death.
Can Indian Residents open a joint account with an NRI?
Indian Residents can open a joint account with an NRI on “either or survivor” basis according to the Reserve Bank of India (RBI). The term “either or survivor” refers to the condition where both of the account holders can operate the account independently in the absence of the other.
NRIs can be a joint account holder in more than one bank accounts as long as they are closely related to all the resident account holders. For example, an NRI can be a joint account holder for both his/her mother’s and father’s account in India.
Indian Residents can open a joint account with an NRI. However, such joint accounts are opened with some conditions, which are:
- Such joint accounts can be opened between an NRI and a relative who is a resident of India (Parents, siblings, spouse, siblings’ spouse, children, spouses’ of children, grandparents, grandchildren, spouses of grandchildren)
- All rules and regulations applicable to a resident bank account will be applicable to the joint account
- The NRI must sign a declaration and submit it to the bank stating that the funds in the joint account will not be used in violation of FEMA guidelines
- The NRI can not deposit any money (in form of cash, cheque or remittances) in the joint account
- The money in the account can not be transferred outside India or given as a gift or transferred to the NRE/NRO account of the NRI
- The resident Indian will be the primary account holder and the NRI will be the secondary account holder
- The joint account can be used by the resident account holder to carry out payments in India
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