Having a bank account is very important today as it plays an important role in our day-to-day life. Be it to manage savings and investments or to keep a record or current expenses, bank accounts provide a simple and organised bird’s eye view of the money oneinteracts with. But how doesonecontinue to manage theirmoney with the same efficiency if theyare supposed to relocate, not just to another city or state but to another country?
When resident Indians get their status changed to NRIs, they are no longer allowed to operate an Indian bank account with a residence proof. Insuch circumstances, an NRI account can be the simplest way to access and operate the money and investments they have already made in India, as well as any future investments they may make.
What is an NRI Account?
NRI accounts are special types of bank accounts that are opened under the name of and operated by a Non-Resident Indian (NRI). NRI accounts are requiredbecause NRIs are not permitted to operate a resident savings account in India, and are required to conduct variousbanking operations via a non-resident account.
Types of NRI Accounts
NRI accounts can be used for various purposes, such as savings, deposits, and more, for income earned in either India or another country. Based on the purpose of the bank account, NRI accounts are broadly classified into two categories:
- NRE Accounts
An NRE account, or a Non-Residential External account, is a bank account opened in India in the name of an NRI to park their income earned outside India. This includes primary income earned by the NRI in theircurrent country of residence. In an NRE Account, there are no tax deductions levied by the Government of India.
- NRO Accounts
An NRO, or a Non-Resident Ordinary account, is a bank account opened in India in the name of an NRI, to manage their income earned withinIndia. This caninclude income earned through interests, pension, rent and more. Since an NRO account holds income earned in India, it is subject to income tax deductions by the Government of India.
How to Open an NRI Account Online
If you have moved overseas recently and want to start banking, saving, or investing in India, then opening an NRI account is an important step in the process. Here is a simple step-by-step guide for opening an NRI account online from the comfort of your home overseas.
- Provide Your Information
The first step inopening an NRI account involves providing your personal and contact details to your bank, so that they can begin the account opening process.If you are residing overseas during this time, you can opt to fill out the non-face-to-face NRI Account Opening Form online.
Types of NRI Account
You can opt to open either an NRE or an NRO Account or both, depending on your financial requirements and plans.
Next, the required documents and approved proofs of identity are to be submitted, along with the proof of your being an NRI. The documents required to open an NRI account onlineinclude:
- Copy of valid passport that includes the pages with your name, address, date of birth, date and place of issue, expiry date, photograph, address, signature, and observation page, if any.
- Non-Resident Status Proof (Visa/Work Permit, etc.).
- Proof of Overseas or Indian Address (Passport, Utility Bills, Rent Receipt, etc.).
- Copy of Indian PAN card or Form 60.
- Recent passport-sized coloured photograph.
- Some banks in India also require an initial payment cheque/draft equivalent to the amount required to maintain the average monthly/quarterly balance.
For non-face-to-face account opening banks require supporting documents that are to be sent along with the NRI account opening application to be attested. You can get your documents attested by:
- Indian Consulate, Embassy/High Commission
- Overseas Branch of Indian Bank
- Foreign Bank with whom the bank has a banking relationship
- Foreign Public Notary
- Additional KYC
You will also be asked to furnish additional KYC documents with respect to your Tax Residency Status under FATCA and CRS.
- Submitting the Application
Prepare and organise the complete set of forms and supporting attested documents for the NRI account opening application before dispatching it to the bank branch. While some banks, like IndusInd bank, offer doorstep pickups via empanelled vendors, the applicant is generally required to drop off the documents at the nearest post office with the bank’s PO Box Number.
Features of NRI Accounts
Here are some of the features of an NRI account:
- Currency in both NRE and NRO accounts is denominated in Indian rupees.
- The accounts are permitted to receive foreign remittances.
- The accounts can also be opened jointly with a resident Indian.
- Transfer of money is allowed from NRO to NRE accounts, post payment of applicable taxes. This requires submission of Form 15 CA CB. The maximum repatriation limit per financial year is USD 1 million.
- Repatriations made abroad through NRO accounts are limited by a maximum annual amount of USD 1 million per financial year. There are no such limitations on NRE and FCNR accounts.
- In case of NRE accounts, the principal and interest amounts are fully repatriable.
- Interest earned on NRE accounts is exempt from tax in India.
Benefits of Having an NRI Account
An NRI account comes with multiple benefits that offer a lot of ease to the account holder.
- Manage income earned in India and abroad in NRO and NRE accounts, respectively, with complete transparency.
- Continue to hold on to the investments made in India or make new investments with ease.
- Invest foreign currency in India through FCNR (Foreign Currency Non-Resident) accounts.
With simplified processes and steps involved, IndusInd Bank is dedicated to offering customers the best NRI savings account programmes, even when they aren’t in the country. Plus, with the provision ofopening anNRI account online from the comfort of your home, without having to visit the bank branch in India, opening an NRI account has never been easy. So, get your documents in order and start banking with IndusInd Bank today!