NRIs and PIOs can invest their savings in their Motherland India and earn lucrative interest.
There are three types of accounts NRI/PIO can hold-NRO, NRE and FCNR B.
NRO and NRE accounts are designated in Indian Rupees and can either be savings or current or term deposit accounts.
FCNR B are only term deposit accounts for a minimum of 1 year and a maximum of 5 years. These are foreign currency deposit and the interest is LIBOR based. Central Bank of India accepts FCNR B deposits in US Dollar, Great Britain Pounds, Euros, Austrailian Dollars and Canadian Dollars.
You can have joint accounts. Joint account holders can be NRIs or resident Indians who are close relatives on a ‘former or Survivor basis and can operate the account as Power of Attorney Holder(POA).
Nominees can be NRIs or resident Indians in your accounts.
Balances in your NRE/FCNR(B) accounts are freely repatriable. Repatriation can be in the currency of your choice.
No wealth tax or income tax is applicable on interest earned on NRE and FCNR(B) deposits.
Loan is given in INR in India against Term Deposits for self as well as for third party whether NRI or Resident Indian. Loans are also given in foreign currency for use outside India to the Account holder/s and to Third parties.
Pre mature withdrawal of deposits is allowed with penal interest.
Deposits against which loans are taken cannot be prematurely withdrawn.
The accounts can be credited by remittances from abroad, by tendering foreign currency and or travellers’ cheques at the time of one’s visit.
NRO Accounts are very similar to domestic accounts. NRI resident in Nepal or Bhutan cannot open NRO account and NRI resident in Pakistan require a special permission from Reserve Bank of India. Repatriation of current income, sale proceeds of acquired or inherited assets and balances in the account is allowed. Alternatively these can also be transferred to NRE account. The total limit for repatriation and transfer to NRE account is USD 1 million in a financial year. Submission of form 15 C A and 15 C B is mandatory for every repatriation or transfer. Tax is deductable at 30% + Education Cess + Higher Education Cess. Alternatively, tax is deductable as per DTAA with the NRI country. Rupee Loan against NRO term deposit is allowed as per rules for loan against domestic term deposits.
Most of the Domestic Term Deposit Schemes like MMDC, MIDR, QIDR and RDS are also available for NRIs.
Other facilities like Internet banking, free SMS alerts, statement of accounts by Email, Debit/ATM cards (valid in India),Safe Deposit Locker are available.
Insurance for home/travel/health/personal accident cover are also provided.
