NRE

For the NRIs / PIOs

Non Resident Indian (NRI)

A ‘Non-Resident Indian’ (NRI) is a person resident outside India, who is a citizen of India.

PIO

A Person of Indian origin is a citizen of any country other than Pakistan, Bangladesh, or such other country as may be specified by the Central Government.

PIO – Must satisfy the following conditions:

Features of NRE Accounts:

ParticularsNon-Resident (External) Rupee Account Scheme [NRE Account]
(1)(3)
Who can open an accountNRIs/ PIOs
(individuals of Bangladesh / Pakistan nationality/ownership require prior approval of RBI)
Joint AccountIn the names of two or more non-resident individuals provided all the account holders are persons of Indian nationality or origin;
Resident close relative (relative as defined in Section 2(77) of the Companies Act, 2013)* on ‘former or survivor’ basis. The resident close relative shall be eligible to operate the account as a Power of Attorney holder in accordance with extant instructions during the life time of the NRI/ PIO account holder.
NominationPermitted
Currency in which account is denominatedIndian Rupees
RepatriablityRepatriable
Type of AccountSavings, Current, Recurring, Fixed Deposit
Period for fixed depositsFrom one to five years,
Rate of Interest With effect from March 1, 2014, interest rates offered by banks on NRE deposits cannot be higher than those offered by them on comparable domestic rupee deposits.
Operations by Power of Attorney in favour of a resident by the non-resident account holderOperations in 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.
LOANSAll loan proposals/enquiries from NRIs must be refered to Head Office
a. In India
i) to the Account holderPermitted without any ceiling subject to usual margin requirements
ii) to Third PartiesPermitted without any ceiling subject to usual margin requirements.
b. Abroad
i) to the Account
holder		Permitted without any ceiling subject to usual margin requirement
ii) to Third PartiesPermitted without any ceiling subject to usual margin requirements.
c. Foreign Currency Loans in India
i) to the Account holderPermitted without any ceiling subject to usual margin requirements.
ii) to Third
Parties		Permitted without any ceiling subject to usual margin requirements
Purpose of Loan
a. In India
i) to the Account holderi) 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 Schedule1 to FEMA 5).
ii) to Third PartiesFund 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)
b. Abroad
To the account holder and Third Parties		Fund based and / or non-fund based facilities for bonafide purposes.

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

Permitted Credits and Debits

Permissible credits to NRE account are inward remittance to India in permitted currency, proceeds of account payee cheques, demand drafts / bankers’ cheques, issued against encashment of foreign currency, where the instruments issued to the NRE account holder are supported by encashment certificate issued by AD Category-I / Category-II, transfers from other NRE / FCNR accounts, sale proceeds of FDI investments, interest accruing on the funds held in such accounts, interest on Government securities/dividends on units of mutual funds purchased by debit to the NRE/FCNR(B) account of the holder, certain types of refunds, etc.