Many individuals from India travel abroad to build a better future and gaining multiple opportunities for growth and development. They either want to gain better education or settle there to make a living. Though it is not easy to tackle the challenges they face daily, the Foreign Exchange Department has introduced some relaxations on the financial and monetary rules for sending and receiving the money from different countries.
An NRI account has helped many individuals meet their requirements, which include financial obligations, investment objectives, and plans of spending their time abroad. These accounts are accessible only by individuals residing out of the geographical territories of India for at least 120 days a year.
NRIs can open these accounts with their earnings originating from India or their country of residence, depending on the type of account. NRI bank account consists of three types, namely NRE (Non-Resident External Account), NRO (Non-Resident Ordinary Account), and FCNR (Foreign Currency Non-Resident) bank account.
NRE Account
Non-Residential External or NRE account is opened and maintained by NRIs with earnings from the respective individual’s country of residence. They get converted into Indian rupee denominations.
NRO Account
An NRO or Non-Residential Ordinary Account can initiate with income earned from within India and hold in that deposit account in INR denominations. Rent, dividends, etc., can be the source of income of the individual.
FCNR (B) Account
FCNR or Foreign Currency Non-Residential Account facilitates deposits made by Non-Residential Indians (NRIs) or Persons of Indian Origin (POI). They can deposit in the currency of their country of residence, and the same will fall under any one of the foreign currencies prescribed by RBI.
The currencies for deposits in FCNR (B) Account are Canadian Dollars (CAD), US Dollars (USD), Euros (EUR), Australian Dollar (AUD), Singapore Dollars (SGD), Great Britain Pound Sterling (GBP), Japanese Yen (JPY), Swiss Franc (CHF), and Hong Kong Dollars (HKD).
If an individual has earnings in any of these currencies, their deposits in an FCNR (B) account is not subject to conversion. On the other hand, if they earn in any other currency, the deposits made in it are converted to any one of the currencies mentioned above.
NRI account opening involves varying terms and conditions for meeting all sorts of monetary requirements. These differ from institutions. Thus, individuals should undertake financial planning and accordingly deposit their funds in the best accounts available.
The NRI savings account enables secure money deposits and manages currencies according to the country of origin and recipient. They help people meet all financial needs and fulfil all essential requirements.