SITE MAP     CONTACT US     DISCLAIMER  
   About Us     Useful Information     FAQs     Financial Education     Complaints   Other Links   Extra Curricular
 Banking
 Currency
 Foreign Exchange
 Government Securities Market
 NBFCs
 Payment Systems
Home >> FAQs - Display
Date: 01/03/2007
Features of various deposit schemes available to Non-Resident Indians (NRIs)

Particulars

Foreign Currency (Non-Resident) Account (Banks) Scheme (FCNR(B) Account)

Non-Resident (External)Rupee Account Scheme (NRE Account)

Non-Resident Ordinary Rupee Account Scheme (NRO Account)

(1)

(2)

(3)

(4)

Who can open an account

NRIs (individuals / entities of Bangladesh/ Pakistan nationality/ownership require prior approval of RBI)

NRIs (individuals / entities of Bangladesh / Pakistan nationality / ownership require prior approval of RBI)

Any person resident outside India (other than a person resident in Nepal and Bhutan) (individuals / entities of Bangladesh / Pakistan nationality / ownership as well as erstwhile OCBs require prior approval of RBI)

Joint account

In the names of two or more non-resident individuals

In the names of two or more non-resident individuals

May be held jointly with residents

Nomination

Permitted

Permitted

Permitted

Currency in which account is denominated

Pound Sterling, US Dollar, Jap. Yen, Euro, Canadian Dollar and Australian Dollar

Indian Rupees

Indian Rupees

Repatriable

Repatriable

Repatriable

Not repatriable except for the following in the account - 1) Current income 2) Upto USD 1 Million per financial year (April- March), for any bonafide purpose out of the balances in NRO account / sale proceeds of assets in India acquired by way of inheritance / legacy inclusive of assets acquired out of settlement subject to certain conditions.

Type of Account

Term Deposit only

Savings, Current, Recurring, Fixed Deposit

Savings, Current, Recurring, Fixed Deposit

Period for fixed deposits

For terms not less than 1 year and not more than 5 years.

At the discretion of the bank

As applicable to resident accounts.

Rate of Interest

Subject to cap :

LIBOR / SWAP rates for the respective currency / corresponding maturities minus 25 basis points 

 

Subject to cap :

Fixed Deposits :

LIBOR / SWAP rates, as on the last working day of the previous month, for US dollar of corresponding maturities plus 50 basis points with effect from close of business on January 31, 2007.

Savings Bank Account

Interest rate shall be at the rate applicable to domestic savings account with effect from close of business in India on 17-11-2005.

Banks are free to determine interest rates for term deposits.

Operations by Power of Attorney in favour of a resident by the non-resident account holder

Operations on the account in terms of Power of Attorney is restricted to withdrawals for permissible local payments or remittance to the account holder himself through normal banking channels.

Operations on the account in terms of Power of Attorney is restricted to withdrawals for permissible local payments or remittance to the account holder himself through normal banking channels.

-

Loans

a. In India

i) to the Account holder

ii) to Third Parties

 

 

Permitted up to Rs.20 lakhs

Permitted upto Rs.20 lakhs

 

 

Permitted upto Rs.20 lakhs

Permitted upto Rs.20 lakhs

 

 

Permitted

Permitted

b. Abroad

i) to the Account holder

ii) to Third Parties

 

Permitted upto Rs.20 lakhs

Permitted upto Rs.20 lakhs

 

Permitted upto Rs.20 lakhs

Permitted upto Rs.20 lakhs

 

Not Permitted

 
Not Permitted

c. Foreign Currency Loans in India

i) to the Account holder

ii) to Third Parties

 


Not Permitted

  Not Permitted

 


Not Permitted

  Not Permitted

 


Not Permitted

  Not Permitted

Purpose of Loan

a. In India

i) to the Account holder

 

 

i) Personal purposes or for carrying on business activities. *

ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies

iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 9 of Sch. 2 to FEMA 5)

 

i) Personal purposes or for carrying on business activities. *

ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies

iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 6(a) of Sch.1 to FEMA 5)

 

 

Personal requirement and / or business purpose *

ii) to Third Party

Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Please refer to para 9 of Sch. 2 to FEMA 5).

Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Please refer to para 6(b) of Sch. 1 to FEMA 5)

Personal requirement and / or business purpose *

b. Abroad

To the account holder and Third Party

 

Fund based and / or non-fund based facilities for bonafide purposes.

 

Fund based and / or non-fund based facilities for bonafide purposes.

 

Not permitted.


* The loans cannot be utilised for the purpose of re-lending or for carrying on agriculture or plantation activities or for investment in real estate business.

Note :

a. When a person resident in India leaves India for Nepal and Bhutan for taking up employment or for carrying on business or vocation or for any other purpose indicating his intention to stay in Nepal and Bhutan for an uncertain period, his existing account will continue as a resident account. Such account should not be designated as Non-resident (Ordinary) Rupee Account (NRO).

b. ADs may open and maintain NRE / FCNR (B) Accounts of persons resident in Nepal and Bhutan who are citizens of India or of Indian origin, provided the funds for opening these accounts are remitted in free foreign exchange, Interest earned in NRE / FCNR (B) accounts can be remitted only in Indian rupees to NRIs and PIO resident in Nepal and Bhutan.

c. In terms of Regulation 4(4) of the Notification No.FEMA.5/2000-RB dated May 3, 2000, ADs may open and maintain Rupee accounts for a person resident in Nepal / Bhutan.

d. The regulations relating to the various deposit schemes available to Non-Resident Indians have been notified vide Notification No.FEMA.5 dated 3rd May 2000, as amended from time to time. The relevant Notifications and A P (DIR Series) Circulars have been placed on our website www.rbi.org.in and may please be referred to for full details.

 
  © Reserve Bank of India. All Rights Reserved.

Best viewed in 1024x768 resolution in IE 5 and above.