Are you aware of the different types of NRI account?

What is an NRI account?

If you didn’t know, a non-resident Indian (NRI) may also run a bank account (savings/fixed deposit and/or current) in India. Such accounts are operated by a person of Indian Origin or an Indian citizen residing overseas. However, this access is restricted to NRIs and not foreign internationals. To establish and maintain an NRI bank account, households need not seek the permission from the Reserve Bank of India, they can simply come in contact with a bank holding the license to deal in foreign currency. There are now various types of NRI accounts in India, which provides users with a variety of options to choose from, with each type characterized uniquely.

The Types of NRI Account

Among the various types of NRI accounts prevalent in the country, the most common types include:-

1) NRO Account - a Non Resident Ordinary Rupee (NRO) Account, is a current or savings account in an Indian bank. This helps the NRI manage their earnings in India, including dividends, rent and pension from other countries. This account is operated just like another Indian resident’s account. The funds are reserved in Indian Currency and can only be repatriated by permission from the RBI. Interest on balances is accumulated, however it is subject to tax. This account is ideal for an NRI earning in India, constantly requiring to withdraw or deposit in the account with no intention of repatriation.

2) NRE Account - a Non Resident External Rupee (NRE) Account refers to the type of NRI account India which girdles to help in the assistance of depositing funds, to a financial entity in India. There is an agreement upon the conversion and/or transfer of these funds to Rupees from Foreign currency or vice-versa, in and outside India. Ergo, repatriation is feasible through this account, though the reserve is kept in Rupees. The account holder’s earnings on investments in any part of the world, can be credited to this account and the interest accrued is tax free. This account is ideal for an NRI who frequently has to send money to or from India.

3) FCNR Account - a Foreign Currency Non Resident (FCNR) Account is that type of an NRI account which enables the NRI to save their overseas deposits in an Indian bank as term deposits for up to a maximum period of 5 years. This is more like a fixed deposit of sorts, rather than a savings account and withdrawal before the time period, results in the payment of a penalty. The reserves are maintained in foreign currency and any interest or payment receipts earned are maintained in the same currency as well. However, it can also be made available in Indian Currency with existing exchange rates. The taxation policy remains the same as an NRE Account.

4) NRI Trading Accounts - a non-resident Indian trading account makes it a possible prospect to invest in the Indian trade market through depositing funds in this account. There are several sub-categories under this type of an account, namely - NRO Demat Account, NRE Demat Account, and Foreign National Demat Account.

A few Indian Banks providing such facilities to NRIs include - SBI, HDFC, ICICI, Central Bank of India, etc.

How can an education loan assist you further your education?

What is an education loan?

An education loan is a type of loan that is taken by students to pursue higher studies in an institution of their choice. Most students take education loans to undertake higher or professional education either in India or abroad. The loan is usually provide to students who have secured admission in a particular institute.

Eligibility for an educational loan –

1. Students of ages 16-35 years are eligible for these loans. The students should be pursuing graduate, post graduate or PhD programs.
2. In case the loan amount exceeds Rs 7.5 lakh, you will be required to submit a collateral security.
3. Admission certificates to courses in recognized college or universities.

What does an education loan cover?

An education loan generally covers the tuition fees, accommodation charges and exam charges. In case of a foreign institution, the travelling charges can also be included in the loan amount.

Advantages of taking an education loan –

1. Study loans are easily available
Education loans are easily available. Most private and nationalized banks offer a wide range of educational loans designed to cater to a large customer base. The procession time for the loan papers range from 15-30 days.

2. Easy access to quality education
Lack of funds can be a big deterrent if you want to pursue higher education. In today’s world, the world of education has undergone a sea change, courses have now become more specialized. With increasing specialization and improved infrastructure, education has become more expensive. An education loan thus can help an aspiring student to pursue their dreams.

3. Repayment moratorium
An education loan allows you to start paying back the loan amount only a year after you have completed the course or after six months if you get a job, whichever is earlier. The moratorium period gives you a much needed relief from having to start paying the loan immediately after you complete the course. However, you can get an interest concession of 1% if interest is paid during the moratorium period.

4. Low interest rates
Education loans usually have very low interest rates when compared to a personal loan. If a student has a good track record and is seeking out a premium institute then a lower interest rate can be negotiated. For amounts below Rs 4 lakh, there is no collateral required. The interest component of an education loan is eligible for tax benefits till the time you pay off the loan or eight years, whichever is earlier.

All you need to know about the portfolio investment scheme

Portfolio Investment Scheme (PIS) has been newly introduced by the Reserve Bank of India to make the route to foreign investment in India simpler and attractive. This scheme enables NRIs and OCBs to purchase and sell shares of Indian companies without getting involved into too much of complications and investment related technicalities.

All transactions will be recognized by stock exchanges and routed through your active NRI savings account.

How attractive is India to foreign investors?

India is one of the most appealing destinations of foreign investment. The country is projected to become the third largest economy in the world by 2025. Research and analysis rates India as the best investment destination, ahead of China. 65% of the Indians are in the working age group of 18 to 64 years, making the demography of India favorable for investment. The BSE Sensex in India has remained stable despite global turmoil. All these advantages invite foreign investors to India.
There are several conditions that should be fulfilled if you want to avail this scheme. You definitely cannot be an Indian resident and must have received permission from any AD Category- I bank (banks authorized by RBI to administer the PIS). Your salary details, age, employer and your designation in your company etc. are required to carry out portfolio investment in India.
You need to start with opening an account with any of RBI approved bank of AD Category- I who has a wide network and international presence. You may also open a Special Non-resident Rupee Account (SNRR) as your first step towards portfolio investment in India.

Requirements
Documents required for portfolio investment in India are a PAN card, 3-4 passport sized photographs, photocopies of an Indian address proof such as Voter Id Card, Driving License etc, an Overseas address proof, a PIO card or OCB master card, a permanent foreign Id proof and VISA card.
Apart from these, you may also be asked to submit your salary and savings details, your assets and liabilities etc. depending upon the requirements of the bank you have chosen.
The annual maintenance fee to keep your Portfolio Investment Scheme (PIS) account active is around Rs. 1000 + service tax and you also need to pay an RBI approval fee of Rs.750 + service tax.

Thus Portfolio Investment Scheme is a lucrative offer and India’s rapid economic growth coupled with an increasing number of indigenous companies, assures you a high return on investment.

Learn how to send money to India the right way

There are multiple ways through which you can send money to India. However selecting the best method is quite a challenging one. You need to consider various aspects like the amount you need to transfer, the speed of transfer, whether it’s one-time transfer or a regular one, the cost associated and also the convenience of the receiver.
Some typical methods are listed below:

1. Online Money Transfer

It’s the easiest way of money transfer to India. You just need two things to initiate the transfer– an internet connection and an access to local banking services. For this you will however need information like the name and address of the recipient along with the name of the financial institution and its IBAN or SWIFT code. Online transfers are specifically recommended if you transfer funds on a regular basis as it allows you to avoid the stiff banking charges.

2. Wire Transfer

Wire Transfer is also one of people’s favorite when it comes to transfer of money to India. All a sender needs to do is visit a bank or other agencies which offers such transfers and send money to India. This process however may take few days while the institutions gathers the necessary information regarding the recipient and the recipient's bank and then commence the transfer.

3. International Money Order

If you are looking for a safer, cheaper and a faster way to make a money transfer to India, specifically to the remote places, then you may opt for International Money Orders. These orders can easily be deposited into the recipient’s bank account and at the same time cashed at various check cashing kiosks.

4. Cashier’s Checks and Bank Drafts

This method has both pros and cons. It requires a minimal fee to be paid in a considerable amount of time. Also the cost required to buy a bank draft is more than that of a money order. However you can trace the money you have transferred in case it fails to reach the appropriate destination.

5. Personal Checks

You can also send personal checks in foreign currency as it is time consuming. However, it may require the recipient to pay extra fee for the exchange rate and the encashment.

6. E-mail Transfer of Money

This type of online money transfer is safe and secure and charge free. All you need to do is to log in to a the bank’s website and fill a form mentioning the receiver's e-mail id and answering security question, the answer of which is shared with the receiver. The bank then sends an e-mail to the receiver and after validating his authenticity he is forwarded to his bank's website where he is asked about the details of his bank account ensuring the completion of the transaction.

NRI Banking Scams: How to protect your foreign banking transactions?

What is a scam?

A scam refers to an illegal act, generally put forth by an entity or entities with the intention to earn money or other valuable possessions. However, banking scams have been a common occurrence, not only in India but also other countries. Innocent customers have been deceived by scammers, improving on their methods day to day. However, with the government and private banks raising awareness on the issue and providing guidelines to safeguard your account, we have observe lesser of such cases.

Current Scenario

NRI banking and its security measures’ demands have marked up over the past decade. Fraudsters have victimized many account holders, especially NRIs. Their techniques to entice you have also improved over time and so has their operational level. A few bank managers have also been involved in scams recently, associated with unusual channeling of money in NRI held bank accounts. These accounts are mostly handled by individuals in India, although each financial institution undertakes personal monitoring of the account themselves. This is because even if your Indian associate handling the account is not involved in perpetrating a scam, they might be the victim of one.

Banks have identified such schemes on their websites and blogs on social media are full of information on how to adhere to precautionary measures in order to safeguard your bank accounts and monetary possessions from such fraudulent schemes.

Types of Scams

The fact that we have identified and understood how to tackle them signifies our progress. Two typical banking scams prevalent in today’s world include:-

Phishing – This type of swindling involves customers receiving emails from accounts that seem to be originally from their banks, because they direct them to similar web pages and beguile them to expel sensitive information. They allure customers who do not have a keen eye to detect minor differences from emails belonging to their bank. Those customers who give out information such as their passwords, usernames, atm pins, etc. end up falling prey to these scammers. The only way to protect yourself would be to observe the differences in these mails and the original ones from your bank. Before spelling out personal information, it is suggested to confirm the scheme from the bank.

Malware - Trojans, viruses and other web associated platforms can be downloaded on your computer with minimal requirements from your end. All it takes from your end is to open an email and on the other hand your computer downloads the virus which provides a hacker with all your personal information saved. Regularly checking your device and its functions and monitoring whose emails you receive can help you tackle this menace.

NRI services in India have provided efficient knowledge on other such schemes which include:- money mules, card cloning, SIM frauds etc.

The ideal guide on sending money to India

Transferring money

Transferring money from one to any other part of the world is no more a boisterous task. Indian banks accept various kinds of money transfers and has equipped its banks to receive currencies from all parts of the world. As we march towards a global digital economy, cashless payments are becoming a frequent practice. With such digitization, a lot of options are available for households to send money to India.

Depending upon your requirements you may choose from many mediums to send money. Each medium comes with its own unique procedure; although the ultimate objective is the same.

Means of Transfer

Out of all options, the most common ones include:-

 Bank transfer - the traditional way of electronically paying a merchant or transferring funds from your bank account to another.
 Wire transfer - international transfer of monetary value between banks.
 FX transfers - you can use forex brokers to help you transfer funds. This proves beneficial for big amounts.
 Money transfer agencies - Agencies like the Western Union, take a surcharge and transfer funds from one entity to the other, in different places.
 Online Transfer - you can choose amongst a number of digital arbitrators and compare currency rates to choose the best possible options available.
Therefore, it does not matter where you are in the world, transferring money to India can be done with sheer convenience.

Taking into account the features of each medium, you can analyze and then decide the best option for you. Each medium or agency that is associated with money transfer to India, has established their own norms and as such users are required to read them carefully. This is because the transfer of cashless money involves a lot of risks. Cashless transactions are accurate but are subjected to strict policies and regulations, with each medium functioning based on their own established guidelines.

Which is the right credit card you should apply for?

What is a credit card?
A card issued to someone (cardholder) on the basis of a line of credit and a supervised account, to grant access to the cardholder for payments to any merchant is called a credit card. Depending on the line of credit, the cardholder borrows this money for the payments being made for which he/she agrees to pay back the issuer along with interest for the transaction(s).

A credit card differs from a cash card. Since it is not necessary for the holder to clear the amount due at the end of the month; he/she can extend it as a recurring debt and clear it later, subject to a sum of interest.

Applying for a Credit card

When applying for credit cards in India or international banks one should adhere to the prescribed ‘Dos and Don’ts. For digitization of currency comes with great benefits but also a few setbacks. Therefore, one should form an analysis of the payments that he/she would be making using the card which will allow the user to apply for a particular category of credit cards. In today’s world, banks provide you with a variety of credit card options to choose from and as a rational customer you should apply for the category which provides you with the maximum utility.

Types of Credit card

The most common types of credit cards in India have been categorized based on a particular area of expenditure. A few common categories in practice are on the basis of:

1) Lifestyle - if you use the card mainly for shopping, dining out, etc. Lifestyle credit cards offer maximum utility as they are designed to reward you with bonuses and cash back.

2) Travel - credit cards providing you access to airport lounge facilities and other rewards on your tours and expeditions.

Customized cards for each Individual

Presently credit cards are personalized for an individual and while applying for one, do look up the benefits in store for you and whether or not it entails benefits that makes using the credit card more feasible. However, your credit score plays an important role here. The card you get is based on your credit score which is estimated by the bank.

A bank or the card issuing body forms a revolving account for the subscriber and associates it with a credit score which estimates the borrowing power of the cardholder. This procedure is the reason most people apply for a credit card in the same bank they have an account in. However, this puts you in a tricky spot as the bank might hold you liable in case of abnormal activities by your card (even when you are not involved in it). Such incidents have occurred with various clients in the past. This is why just applying for a credit card from the same bank might not always be the best option.