What are the different types of NRI Account?

As an NRI, you might come across numerous options and might have to choose between multiple products when it comes to deciding about your savings and investments. You can make an informed choice only when you are aware of the various options that are available to you. This will help you ensure that your money is better invested and generates better returns.

What are the types of NRI Accounts?

There are various types of NRI Accounts that are available to an NRI Investor. Some of the major ones are-

• Non-Resident Ordinary (NRO) Savings Account/ Fixed Deposit Account
• Non-Resident External (NRE) Savings Account/ Fixed Deposit Account
• Foreign Currency Non -Resident (FCNR) Fixed Deposit Account

Given below is a list of comprehensive features of each type of account-

• NRE Savings Account /Fixed Deposit Account
  • NRE Accounts are maintained in INR. This means that when you deposit the money in the NRE Account, the foreign currency is converted to Indian rupees at the prevailing foreign exchange rates.
  • It is mainly used to house your savings from income that you have earned abroad. 
  • The principal amount, as well as the interest, are fully repatriable, i.e., transferable.
  • The interest income earned on the amount in an NRE account is non-taxable in India.
  • You can have other NRIs or Resident Indian (who is a close relative as per Companies Act 2013) as joint account holders in NRE Accounts. In case Resident Indian is added as Joint holder the mode of operation will be 'Former or Survivor'.
    ​​​​​​​
• NRO Savings Account/Fixed Deposit Account
  • NRO Accounts are maintained in INR. This means that when you deposit the money in the NRO Account, the foreign currency is converted to Indian rupees at the prevailing foreign exchange rates.
  • It is used to house funds from your income that you have earned from India or abroad.
  •  Income like rent, dividend, pension, etc. can be sent abroad through the NRO Account.
  • Interest income earned on the amount in an NRO Account is liable for TDS or Tax Deductible at Source.
    
  • You can have other NRIs or Resident Indian as joint account holders in NRO Accounts. In case Resident Indian is added as Joint holder the mode of operation will be 'Former or Survivor',
    ​​​​​​​
• FCNR Account
  • Foreign Currency Non -Resident Accounts have to be opened and maintained in foreign currency.
  • Your principal amount and the interest in an FCNR Account are fully repatriable, i.e., transferable
  • Interest income earned on your money in an FCNR account is non-taxable in India.

You can also opt for other products like NRE/NRO Current account, NRE Recurring Deposit RFC Savings/ RFC Deposits etc.

You can read more about the FCNR Account here.

Looking to apply for an NRI Account? Click here to get started!

* The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.