All you need to know about NRI accounts

There are a few different kinds of NRI accounts. Some banks offer the NRI bank accounts which have a number of features like you can withdraw Rs 40,000 from the ATM daily, you could enjoy personal banking benefits through specially designed account for the NRIs who do wish to get interest credited to their savings account.

There is also the option of multi-channel banking where through internet banking you could transfer funds, pay bills, view account summary in internet banking. Through mobile banking you could check balances transfer funds, request for cheque books and also you could make your utility bills payment using your mobile phone, you will also get SMS alerts and monthly e-statements and quarterly physical statements to keep a track on the bank transactions and other banking activities.

An NRI account would also get personalised cheque book every quarter. There is a host of other banking benefits and facilities, you could get special privileges on remittances from your relatives and friends abroad, you will also be able to keep a joint account, enjoy loyalty reward points.

You could also keep your assets safe, there are lost card liability and also purchase protection liability  up to a certain amount to protect against the fraudulent usage of the credit card, it could also be put to use during the damage or the loss of articles purchased with the debit card.

Along with that you also have the NRE savings account which can be opened by any person staying outside India. All the NRI’s who have an NRE account in India are given the permission to hold and maintain foreign currency earnings in Indian rupees. All the funds along with the accrued interest are freely repatriable and what’s more the interest that is earned is not taxable in India. The NRE account can be easily converted into a regular resident account with the relocation of the NRI back to India. The account is structured ina manner that is suitable for most people who are living abroad. He or she might be a professional who is deputed overseas or an entrepreneur moving all across the world to do his business. It is also very convenient to start off; you just need to submit a few documents to get started with your very own NRE account. There are lot many features that are for your benefit. Some features like low minimum balance requirement, tax advisory services, multi-city cheque books, online transaction options. There are all the features that are required by any Non-resident Indian to tactfully maintain their balances in India. Therefore it is very necessary to have an NRI account for any non-resident Indian.

All you need to know about NRO accounts

An NRO account is a non-resident ordinary account. It lets you park your rupee funds gathered from earnings in India. It also offers free money transfer at a competitive rate structure. You could also add an Indian resident as a joint holder to your NRO account so that he/she can operate your account. There would also bea free mandate card and chequebook for your family in India and this would give then anytime and anywhere access to your account.

Now let us have a deeply detailed look into what an NRO account actually is.

A non-resident ordinary account or an NRO account is a savings account essentially where you can maintain and manage your income earned in India for instance, the rent collections, the dividends, pension etc. Whenever you choose an NRO account you can be assured of and efficient management of your rupee earnings in India while you are staying abroad. There is also the facility of an easy redesignation of your account when your status is changed from resident Indian to a non-resident Indian.
There are a lot many benefits when you are going in for an NRO or a Non-residentordinary account. These benefits are enlisted below
You will get a higher yield post-tax: this can be done by availing the DTAA benefit facility.

You can also avail the benefits of low cost and hassle free money transfer which can be made available through various online and offline modes at extremely competitive exchange rates.

Very low balance is required in order to keep the account in the up and running status. The minimum account balance to be maintained is as low as Rs 10,000 only. If this balance is maintained, the account will be in the running status.

You will be able to access your account anytime and anywhere with domestic ATM cum debit cards, you will also have convenient and access to over 11000 ATMs, in the branches all over India and the phone and internetbanking as well.

You could also be benefitted from the interest rates that are calculated on daily closing balances at 4% per annum. The interest is paid half-yearly in June and December.

The interest that you earn in the current financial year is completely repatriable but only after the tax is deducted.

You can also avail simple and convenient money transfer tracking service with anonline transfer to more than a 100 banks in India.

The mandate holder would get a free chequebook and an ATM card so that he/she can access your account from anywhere and at anytime

Are you aware of the different ways to send money to India?

There are a lot of ways to send to money to India. You can do an e-transfer or you can also use the traditional methods to send money to India. Whichever way you prefer it is always wise to do your research before you use any of these methods to send money to India.

International money order – International money orders are safe, cheap and a very fast way of sending money. This process if sending money is very good especially when you are sending money to remote places in India. The money orders can be deposited in your bank account, or you could also encash them in many cheque encashing locations. However to encash the cheques most will require n ID. It s simple to purchase and no cheque account is required. This is a very convenient method to send money to India if the amount is small.

Personal Cheques – You can also consider the option of sending a cheque in the foreign currency. The encashment f the cheque can be delayed though because the bank has to verify the cheque before doing it. The recipient has to give an additional fee based on the current exchange rates and per the encashment rules. This method is safer instead of sending cash by mail because once the cash is sent and it reaches the wrong destination, it cannot be brought back, however in case the cheque reaches the wrong destination, the cheque can be cancelled.

Email money transfer – It is an online money transfer. Here are no extra charges associated with this kind of transfer of money because this is very similar the bank to bank transfer. However in this case it is not mandatory for the sender to have the bank information of the recipient.  The person who is supposed to send money to India had to log onto his bank website and fill the form.The form doesn’t ask for too much detailed information;just the mail id of the recipient and the security question needs to be answered. The answer to this security question has to be shared by the sender only with the recipient. The bank then sends an email to the recipient and then the recipient needs to validate his identity for which he/she too requires to answer a security question accurately. If he answers the question correctly he will be forwarded to his bank[s website asked for the details of his account and then the transaction would be completed. This process just takes a day of the recipient’s bank is in the list provided b the sender’s bank. If the bank is not listed in the sender’s bank list, the transaction might take up to 3 to 5 days to complete.

These are some of the common ways and most used ways to send money to India.

All you need to know about NRE and NRO accounts

All Non-resident Indians whoare residing out of India have to open an NRE account  because NRI’s who have an NRE account are only permitted  to hold and maintain foreign currency earnings in Indian rupees and all the funds along with the accrued interest  are freely repatriable  and the interest that is earned is not taxable in India. An NRO account also lets the Non-resident Indian to maintain aRupee account in India.

Similar points to note between the NRE and NRO accounts

1.Repatriation – NRE account is freelyrepatriable i.e. the principal and the interest earned onthe other hand an NRO account has a limited repatriability i.e. permitted remittance is allowed  from NRO is upto USD 1 million net of the applicable taxes inthe financial year after submitting an undertaking and a certificate from a chartered accountant .

2.Tax treatment – NRE account is tax-free which means there is income tax, wealth tax and gift tax in India on an NRE account. On the contrary the interest that is earned inan NRO account and all the credit balances are subject to respective income tax bracket and the gift tax and wealth tax are also applicable.

3.Deposit of rupee funds generated in India – If a Non-resident Indian (NRI) or a Person of Indian Origin (PIO) or an overseas citizen of India (OCI) is earning income originating in India which might be salary, house rent or dividends so on and so forth, he or she is only allowed to deposit into the NRO account. Such earnings are barred from being deposited into an NRE account.

4.Joint Holding – NRE account can be jointly held with another NRI but with not a resident Indian. On the contrary the NRO account can be jointly held with another NRI as well as a resident Indian which has to be a close relative as defined in the section 6 of the Companies Act 1956.

5.You can choose an NRE account if your primary reason is to park  your overseas earnings remitted to India converted to Indian rupees or you want to maintain  savings in Rupees and want to keep them liquid or you want to make a joint account with only another NRIor you want your rupee savings to be freely repatriable.

6.Go for an NRO account only when your primary reason is that you want to park India based earrings  in Rupees in India, want your account to deposit income earned in India such as rent, dividends so on and so forth or you want to open an account with another resident Indian who happens to be a close relative.

Some ways to remit money to India

Transferring money to India has never been easier

If anyone wants to send money to India the procedure is very efficient and there are a lot of ways to do it. There are multifarious money sending options  available  that the business decision of which to use is also very demanding.  Here are mentioned are some of the ways to send money to India.

1.ACH transfer – an ACH transfer or an Automated clearing house transfer is a very good option for businesses based in the US. You just have to send the money from your bank account by the ACH transfer and whoever you are sending it to will get it in the next 4 days. In this method one doesn't need to make additional trips to the bank and neither does one have to pay any charges and thus this is quite a promising way to send the money because of the fact that it saves you both the time and the money.

2. Online transfer – This method of money transfer is perhaps the most basic and the most used as well. All you need for this kind of money transfer is the basic details of the person who is the recipient of the money for instance the name of the person, address and bank account. You can do this whenever you want to from the comfort of your own home, a computer and an internet connection.

3.PayPal -  Paypal is the largest online payment processor. You can easily transfer your money to India from a bank account to another without directly using your credit card or bank account. Whoever sends the money is not required to pay any fee but the recipient has to pay a nominal fee on the transaction

4.Wire Transfer – This is a traditional method of payment,, it is also the oldest method and this method existed for the last 10 years. In case you want to use this method, you have to go through the banks and other agencies so that the money can be sent. Just when you provide the institution with the required information about the recipient , they will start the money transfer procedure and then send the money. This process is actually pretty long drawn. A wire transfer may actually take a few days before the recipient gets the money. One important aspect about wire transfers is that they cannot be used to transfer small amounts of money because the fees depend on the money and the destination as well.

These are few of the methods for remitting money to India.

All you need to know about co – signing a loan

A loan is often a practical solution for most financial situations, along with offering plenty of benefits. Through these bank loans, you can easily repay back any financial debt, purchase a home, finance an education degree or even just finance a car purchase.

But while there are plenty of loan types available in the financial market, the fact remains that once the funds are borrowed, it must be repaid back at some point in time. Very often, this can be a sticky situation, especially if there is a chance that the borrower may fail to repay back the funds. Furthermore, the borrower’s financial profile may not allow them to get the ideal loan rates, and ultimately the financial aid to help get out of a financial issue.

This is where a co – signer will help. A co – signer, also known as a joint loan holder will share the responsibilities of receiving and repaying the borrowed funds. This has plenty of benefits as well as disadvantages. For one, with a property repayment strategy and sufficient funding, both applicants’ credit score will improve. If not, not only will both applicant’s score will drop down, but the mark of the debt will remain until the loan is fully repaid.

So if you are planning to become a co – signer for any bank loans, here are some tips you need to keep in mind:

Know your borrower: As a rule, you should keep your finance safe and avoid any risky options. This is equally applicable for when you become a co – signer. At this stage, you need to know your borrowing partner very well. This is including family members and close friends. No matter how closely intimates you are the borrower; you need to be careful before you sign up as a co – signer for the bank loans. After all, this is a debt both parties will share and bear until the loan is repaid. Only if you have absolute trust in the repayment capabilities of your borrower should you proceed with the co – signing.

Review your budget: When investing in the loan as a co – signer, both parties will be responsible for repaying back the borrowed funds. This also includes ensuring you have sufficient funds for the repayment. In the event the primary borrower defaults on the loan, you should be well prepared for the added strain on your budget. However, before taking this step, you should ensure and insist that the other borrower also maintains a sufficient budget to repay the debt obligation. This help assesses and maintains some level of confidence in their ability to repay back the debt. If it looks like there is a possibility that either budget will give way, review your budget strategy for better loan rates.

Get copies of everything: As a co – signer, you will get copies of the loan documents. But you must insist on duplicate statements. If you must, ensure that you get the required login credentials, so both parties are aware of the status of the debt payments.

What are the insurance policies to opt for in your early 30's?

You may be used to the finer things in life, thanks to your well - earning partner. But at any point in your life, you may be reduced to a situation where you will need to struggle to get even the basic of a meal. That is what happens to most individuals who rely on other earning members to maintain their lifestyle.
This is why it is crucial that you insure yourself. With the right insurance cover, brought at the right time in your early life will not only offer a good coverage but also save funds.

So if you are planning to opt for any insurance policies, here are the important three policies you need to opt for:

Term life Insurance: A life insurance may not seem much at a young age. However, there is a possibility at that point in your life; you may be repaying a loan. You may even have parents who are about to retire and who may be partially or fully financially dependent on you. In such a situation, a term life insurance will help in any case of any eventuality. In fact, the younger you are, the cheaper you can buy your term life insurance cover. Experts recommend purchasing a cover that is at least 10 to 15 times more that one’s annual income.

Personal Accident Insurance: Another one of the insurance policies that must be purchased is the personal accident insurance. This is one insurance cover that no individual should ignore, as most working individuals especially in the urban area, is prone to accidents given the required lifestyle. It has plenty of covers that offers a nominal pay, in the event where disability or death occurs. Barring any adventure sports and self-inflicted injuries, this insurance covers plenty of accidents that arise in the normal course of life. 

Health insurance covers: The incidences of hospitalisation may be low at a young age, but it cannot be ruled out completely. In fact, a hospitalisation caused by dengue can cost anywhere between Rs. 50,000 to 1 lakh. While your health cover may be covered by employers providing a health insurance cover, the high propensity of jumping jobs will reduce this likelihood. Furthermore, if you join a start-up, there is a high chance you do not even get the health insurance, putting you at a complete risk. The ideal health insurance cover for such individuals can be anywhere between Rs. 2 to 3 lakhs. As you progress in your job or age, you can then include covers with hospital cash, critical illness or any covers that include specific diseases.

Before you opt for any of these covers, you should use the service of online websites and check all the available options in the market. Avoid considering one factor, such as premium payable, before you make your decision.