Here are some of the benefits of an NRI account

According to the Foreign exchange management act or the FEMA it is illegal for NRI’s  to have any resident savings bank account  in India. As an NRI you will require changing your resident savings bank account into an NRI account and you have two choices in that, it can either bean NRO or an NRE account. If in case you carry on using your resident account, you will be penalised heavily. You can either convergent your existing account or close your existing account and open a new NRO or NRE account.

NRE or NRO is a savings bank account for the Non-resident Indians These two accounts can be opened by any NRI. MRE stands for Non-resident Indians there are many differences between them and depending on their features you can choose to open whichever account that suits you.

The NRE account lets you keep money in Indian rupees. This account then further lets you open one of the best-fixed deposits  investment option known as the NRE fixed deposit which currently provides a fixed and interest rates and very good returns  on NRE fixed deposits.

Since many NRI’s are not aware of these feature NRI account benefits and advantages, here are few of the benefits shared below:

1.Tax benefits: One of the major NRI account benefits is that the interest earned on the NRE savings account and the NRE fixed deposit is tax-free in India. They aren’t counted in the taxable income bracket and this is even when you have many sources of income in India.  Due to this feature the NRE fixed deposits are the most secure and high yield investment options that are available for the NRI’s

2.Low balance required – Due to the increased competition amongst the private and the public sector banks, the minimum balance required in order to keep the NRE account functional has dropped hugely. Nowadays many banks require just Rs 10,000 as a minimum balance to keep the accounts functional.

3.High-interest rate – Another significant benefit of an NRI bank account is the NRE fixed deposits offers high-interest rates even though the rates differ from one bank to another. The good part is that these interest rates are calculated on the daily closing balance and the interest is paid half-yearly in June and December and this too varies from one bank to another.

4.Joint Holding – Another key NRI account benefit is that you can jointly open it with another NRI. This might also turn out to be the way to manage funds because your partner can operate along with you.
These are some of the NRI account benefits.

All you need to know about NRE and NRI 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 free lyrepatriable 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.

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.