What are the benefits of opening an NRI Account?
SBNRI Team
answered on 22/03/2020
The benefits of opening an NRI Account are as follows:
- Deposit money in INR or any Foreign Currency and earn tax-free interest upto 7.95%* for NRE and up to 3.05%* for FCNR (Foreign Currency Non-Resident) Accounts
- The interest earned on the deposit is not taxable in India
- Earn a higher rate of interest as compared to the local banks abroad
- Both the principal amount and the interest are fully and freely repatriable for NRE and FCNR Accounts
Can OCIs have an NRI Account?
Yes, OCIs can open NRE/NRO/FCNR accounts in India as they are entitled to similar benefits as NRIs. OCIs can also enjoy the benefits of opening an NRI Account. Here is an overview of the accounts for you to choose the best account as per your needs:
|
Factors to consider |
Non Resident External (NRE) Account |
Non Resident Ordinary (NRO) Account |
Foreign Currency Non Resident (FCNR) Account |
|
|
Purpose |
For income earned outside India |
For income earned from India (pension, rent etc.) |
Foreign Currency Investment in India |
|
|
Currency |
INR |
INR |
USD, GBP, EUR, JPY, CAD, AUD, SGD, HKD and CHF |
|
|
Tenure of Deposits |
1 year to 10 years |
7 days to 10 years |
1 year to 5 years |
|
|
Interest |
Up to 7.25%* |
Up to 7.30%* |
Up to 3.05%* |
|
|
Repatriation (transfer of money from Indian bank account to foreign bank account) |
Both Principal (money invested initially) and Interest completely repatriable |
Up to a maximum of 1 million USD per financial year |
Both Principal and Interest completely repatriable |
|
|
Tax Deductions |
No tax |
Tax on Interest earned (not on principal amount): 30% tax + surcharge + education cess will be deducted at the source of interest earned in India |
No tax |
|
Related Questions
SBNRI Team
answered on 05/03/2021
In your case, it would be preferable to convert your funds from NRE Account to an FCNR Account before you return to India. Doing that will give you the benefit of converting the FCNR into an RFC account post your return to India. After the conversion of an FCNR Account to an RFC Account, […]
SBNRI Team
answered on 23/03/2020
Yes, you can deposit cash in an NRO account after sharing the source of income of the money that you are depositing with the bank. Can I deposit cash in my NRE Account? No, you cannot deposit INR cash in an NRE account because NRE accounts are used to maintain the income earned outside India. […]
SBNRI Team
answered on 23/03/2020
Minimum balance for FCNR Account: USD 1000 A Foreign Currency (Non-Resident) Account which is a term deposit account in USD, GBP, EUR, JPY, AUD, CAD, SGD, HKD, and others. The ‘term’ in a term deposit account is a fixed tenure of up to 12 months, 24 months, 36 months, 48 months or 60 […]
SBNRI Team
answered on 30/03/2020
Yes. NRIs can open a joint account with other NRIs for an NRE/NRO or FCNR Account. Joint Account Holding: 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 […]