An NRI savings account is an umbrella term, meaning it includes three categories of accounts, namely:
- NRE or Non-Residential External Account
- NRO or Non-Residential Ordinary Account
- FCNR or (Foreign Currency Non-Resident) Bank Account
Each account comes with distinct features. Here they are:
NRE Account
This savings account is for NRIs who wish to deposit their earnings from their current country of residence into an Indian bank account. The money is held in an NRE account in the Indian denomination.
NRO Account
An NRI can access NRO savings account for depositing any money earned in India. Such an account is beneficial for NRIs who rent out apartments or have other passive income sources within the country. The money in an NRO account is also held in Indian Rupees.
FCNR Account
NRIs can deposit money in the currency of the country they presently reside in an FCNR account. The bank will hold the funds in the same denomination and not convert them into India Rupees. The RBI has approved the following currencies to be held in an FCNR account:
- US Dollar (USD)
- Euro (EUR)
- Great Britain Pound (GBP)
- Canadian Dollar (CAD)
- Australian Dollar (AUD)
- Hong Kong Dollar (HKD)
- Singapore Dollar (SGD)
- Swiss Franc (CHF)
- Japanese Yen (JPY)
Why Open an NRI Savings Account?
There are various advantages to opening an NRI account in India, such as:
Easy Remittance of Funds to Dependents
You might have dependents back in India with whom you wish to share your earnings. An NRI savings account makes that incredibly easy. You can open an NRE account and deposit the money you want to remit. Your family members will be able to access it in the Indian denomination.
Earn Tax benefits
Yes! The money you remit into your NRI savings account is not taxable in India if you have a tax liability in the country of your residence. Simply put, as long as you are paying tax wherever you live, your global remittance is non-taxable here as per the Union Budget Proposal 2020.
Facilitates Financial Investments
Suppose you have a substantial amount that you wish to invest. If you open NRI savings account online, you can partake in the stock market trading and invest money in other financial instruments. Several banks and financial institutions extend the Portfolio Investment Scheme (PIS) to NRIs, facilitating investments in India.
Eligibility Criteria for Opening an NRI Savings Account
You need to fall within the following category of individuals to open an NRI account in India:
- The applicant must be an NRI. PIO (Person of Indian Origin) cardholders can also apply.
- Seafarers who have an Indian nationality but are employed by overseas shipping corporations.
- Students who are pursuing their education in foreign countries.
Documents Required for Opening an NRI Savings Account
The best way to open this account is by applying online. You will need to upload the following documents while filling out a digital application.
- One or two passport-sized photographs.
- Photocopy of your passport pages displaying your personal details.
- PAN card copy, if you have one. If not, you require a copy of Form 60.
- Copy of proof of NRI status (residence permit/ visa copy/ employment visa, etc.)
- Proof of your India or International address
To Sum Up
Do you want to open any one or more than one type of NRI savings accounts in India? If so, be sure to choose a bank that offers a significant rate of interest. Yes, this type of savings account can help you earn an attractive ROI.
So, now is as good a time as any to begin your search!
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