Do you know the benefits of the Different NRI Accounts

The need to hold an Indian bank account does not cease when a person leaves the country to stay abroad. To serve this purpose, banks offer NRIs with special types of accounts such as the Non-Resident External (NRE) Account, Non-Resident Ordinary (NRO) Account and the Resident Foreign Currency (RFC) Account. These facilities helps people staying abroad take care of their family and close ones back in India, with faster and less complicated modes of transaction. With the increasing popularity of digitalization and betterment of the internet facility, transacting and managing NRI accounts have become much easier. Many banks have branches across the globe that makes operating such accounts with better convenience.

TYPES OF NRI ACCOUNTS

1) NRE savings account
2) NRO savings account
3) RCF  savings account
4) RFC savings account
5) NRE current account
6) NRO current account
7) RFC fixed deposit account

REASONS TO HOLD AN NRI

1) NRIs are not allowed to hold resident savings account in India as per Foreign Exchange Management Act (FEMA) guide lines. Hence existing accounts should either be converted to NRI accounts or opened separately after closing the resident account.

2) Manage your earnings from India such as rent, pension, dividend etc. while staying abroad can be done through your NRO account while you shall enjoy a certain amount of interest as well.

3) Earn tax free interest on your foreign income made outside India (NRE). A high rate of interest is provided by the banks on depositing foreign earnings and the amount is tax exempted. This the most important reason why people living abroad wish to hold an NRI account.

4) For those who have returned to India after being an NRI for at least over a period of one year it is very convenient to have an RFC account. You can enjoy tax exemption for the time you remain a Resident but Not Ordinarily Resident (RNOR). This account also allows a person to change it to an NRE/FCNR account in case the person goes back to an NRI status.

5) Manage transactions in India from abroad. You can authorise a person in India to operate the account. In case of an emergency your money can be accessed without your presence. Cheque books and ATM cards are issued to the authorised person.

6) The monthly balance to be maintained is lower as compared to those in foreign banks. This gives you more flexibility to manage your account.

7) Banks provide NRI account holders with international debit cards making transactions abroad faster and more convenient.