An Insight into NRI Account Opening

When you go to a foreign country, it is important to have an NRI account to manage your earnings whether it is generated in India or abroad. An NRI account comes with many benefits, like convenient money transfers, attractive interest rates, the flexibility of repatriation of funds, and easier operations in India among others, that an NRI can get. 

Any non-resident Indian or NRI can open an NRI account with a recognised Indian bank. You can open an FNCR, NRE, or NRO account depending upon your banking needs. Here are some of the benefits of NRI account opening:

NRI accounts are excellent for getting repatriation benefits. An account holder can transfer funds from India to a foreign country. The principal and interest amount in an NRE account can be freely repatriated. On the other hand, there are restrictions on the repatriable amount of the NRO account. The NRO account allows for repatriation of up to USD 1 million per fiscal year.

Another benefit of opening an NRI account in India is its accessibility from any remote location. Nowadays, almost every Indian bank offers mobile banking facilities. An account holder can access all the information related to their account, like balance history, transaction details, and investment details, from their mobile phone. You can access and manage your account from the country where you reside or from any other country. This has eased the accessibility of banking services.

One of the benefits of opening an NRI account is the interest rates offered by Indian banks on NRI accounts and fixed deposits. NRIs can gain excellent returns for funds kept in their NRE/NRO account and FNCR-B deposits.

When a person relocates to a foreign location, they may have some property or investment in India. Opening an NRI account gives them the ability to continue their income from Indian assets like property rent, investment returns, and many more. For example, monthly rent collected from the tenant can be deposited into an NRO account.

India is a growing market that has huge potential. Many foreign and Indian investors have large investments in the Indian market. If you are an NRI person who wants to invest in Indian investment avenues, then it is mandatory to have an NRI account for investment purposes. An NRI individual can invest through portfolio investment schemes in India.

You can protect your foreign earnings from exchange rate fluctuations by depositing them in an FNCR account. Funds kept in this account need not be converted into INR. This is very important for the risk mitigation of exchange rate fluctuation.

An NRI person can get a tax rebate in India under the Income Tax Act 1961. They have no tax liability on the funds kept in NRE and FNCR accounts. However, in the case of an NRO account, interest earned is subject to tax. NRIs can opt for DTAA for tax relaxation.

Many authorised Indian banks provide loans to NRI account holders. This loan facility can be availed against the funds deposited in the NRI account. However, different banks have certain eligibility criteria that must be fulfilled at the time of loan approval.

These benefits can be availed on NRI accounts depending upon the type of account opened by the person with NRI status.

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