Rupee Accounts maintained by NRIs

The Non-Residents Indians ( NRIs) can maintain the following 3 types of rupee accounts :

1. NRE: Non-Resident ( External) Rupee account.

NRE accounts are opened for NRIs and it is also rupee-denominated account. This account is fully repatriable i.e. principal and interest amount both can be moved from India to the foreign country where the NRI is residing. All NRIs can open an NRE account. However, individuals and entities in Bangladesh and Pakistan require prior approval from the Reserve Bank of India. 

2. NRO: Non-Resident ( ordinary) rupee account.

NRO accounts are opened for only those individuals who are leaving India to take up employment or establish business outside India and is a rupee denominated accounts. Local funds that are not eligible to be remitted abroad must be credited to an NRO account. This account has restricted repatriable. Any person resident outside India ( other than a person resident in Nepal and Bhutan) can open an NRO account. Individuals and entities of Bangladesh and Pakistan require prior approval from the Reserve Bank of India. 

3. FCNR: Foreign Currency Non-Resident ( Bank ) Account.

FCNR accounts are opened by NRIs and are denominated in any foreign currency which is freely convertible. This account is fully repatriable. One of the attractive features of an FCNR account is that the money deposited can be in permissible foreign currencies and the interest rate completely depends on the currency type deposited.

 NRI stands for Non-Resident Indian. Non-residents Indian are born into Indian citizens. However, if they emigrated to some other countries for any purpose for more than a given time frame they are considered Non-resident Indians. According to the law of the land, any person who is living outside the territory of India for more than 182 days of a calendar year would be considered an NRI. For an NRI it is mandatory to hold a passport issued by the Government of India. The emigration of such citizens could be anything. It may be some educational purpose, some work relayed purpose, residence, or some other purpose. However, it should be noted that they are citizens of India who live outside the country, and not foreigners.

According to some new constitutional amendments an NRI will be recognized as overseas Indians ( OCs). The Ministry of Overseas Indian Affairs deals with the affairs related to Non-residents of India. All the classification and other statutory provisions related to Non-residents of India are dealt with by this Ministry.