Everything you need to know about NRE accounts

Travelling on the job is a reality in the life of a multi-national corporate employee. Some people are transferred abroad on secondments while others use foreign travel opportunities to find a job abroad. Whatever the case may be, such people are confused about maintaining their bank accounts. They also have questions about what happens to their existing savings if they have to move abroad for work, for an extended period of time. If you are one of these people here’s everything you need to know about opening an NRE savings account.

Which account do I need?

Not everyone who travels abroad for work needs to make changes to their existing savings account. If your work takes you to a foreign country and you return to India within 6 months, you do not need to make any changes to your account. However, if you are travelling for work and must be based in a foreign country for more than 6 months in any given calendar year, you must inform your bank immediately and your bank will convert your account into an NRE account or Non-Resident external account. 

Importance of the term

An Indian citizen who spends more than 182 days (or 6 months) abroad in a given financial year, is referred to as an NRI (Non Resident India) purely because he is exempted from paying taxes in India  in that particular year. However, if he spends less than the given 182 abroad, he does not receive tax exemptions and will be treated as an Indian resident. He must pay a tax on his global income as per the Indian tax laws. For an annual income of more than 10 lacs, he must pay taxes at 30% per annum. However, such individuals do have the option of claiming a tax rebate.

Why should you convert your account to NRE?
If you are posted abroad for a long time, chances are that you may receive your salary in foreign currency. If you are on a secondment, you may continue receiving your salary in INR since you would be returning to your homeland at the end of the secondment term. Since you cannot continue holding your resident savings account once you assume NRI status, you can opt to open an NRE savings account in which you can deposit foreign currencies such as USD, EUR, GBP etc. You can continue funding your investments in India from your NRE account.

Why is NRE a better option?
The rate of interest you earn on your NRE account in India is tax-free. For instance if you make a fixed deposit of ₹5 lacs, which doubles to ₹ 10 Lacs in say, 7 years, then you needn’t pay tax on maturity, even if you are an Indian resident at the time of your FD’s maturity. The NRE account allows you to save a lot of money as FD is taxable on both Resident savings as well as NRO accounts.

Top 4 two wheeler insurance policies to consider

Owing a two wheeler is a blessing. This small-sized vehicle comes in handy every single time. It helps you navigate compact traffic conditions, offers great mileage per litre and doesn’t set your bank account behind by lakhs of rupees. Two wheelers especially come in handy in areas which don’t have the best public transportation networks. Most Indians own two-wheelers but make the mistake of not buying the correct two wheeler insurance plan. This insurance comes in handy if your vehicle endures damage in an accident or if it is stolen or lost. In case you are a new bike owner looking for the best bike insurance plans in India, you could consider one of the following.

TATA AIG Insurance

TATA AIG Insurance is known for offering a plethora of benefits to insurers such as

• Free pick up of vehicle in case of accidents. Additional six-month surety in case of accident repair warranty
• Direct option to make the claim online with the aim of settling it within 7 working days
• Covers partial or total loss of your vehicle in case of accidents along with damages incurred by third party
• Benefits on add-on covers such as key replacement, daily allowance, return invoice, depreciation reimbursement, no claim bonus protection etc.
• Covers loss of personal belongings inside the vehicle during an accident
• Benefit of warranty in case of accidental repairs

HDFC Ergo Insurance

HDFC is India's finest and largest company offering two wheeler insurance with premium benefits. The company has the reputation of caring about customer's requirements and makes efforts to ensure customer satisfaction. 

• Receive assured services, comprehensive coverage, and competitive pricing on policies
• Provides policies online which customers may claim instantaneously merely by following instructions provided
• Covers loss or damage of the two wheeler with hassle-free claim settlement
• Any damage caused while driving with a valid license
• Offers repayment for all accidental damages incurred to the vehicle as well as to the insurance holders
• Provides vehicle repair facilities along with accessories
• Allows online filing of claim
• Easy access to customer care helpline in case of any issues

Bajaj Allianz

Bajaj Allianz is a leading insurance provider, offering several different two-wheelers policies with benefits like

• Free services in select garages as well as timely claim settlement
• Resolves all policy related/service issues with instant assistance for policy holders including SMS alerts on claims
• Covers insurance on all accidents; either manmade like riots, terrorist activities, thefts etc., or natural calamities like earthquakes, floods, typhoons, cyclones etc.
• Provides third party liability benefits for accidental injuries, death of an individual or property damage

ICICI Lombard

ICICI is another popular company offering a good two wheeler insurance policy with benefits such as

• Providing repayment services against any damages incurred due to natural/man-made calamities, including accidents and terrorist attacks
• Provides multiple mode of payment for online premium payments
• Third party benefit on accidental damages/permanent injury/death
• 24/7 call centre team for problem resolution in case of claims

4 types of Personal Loans available in India

Even though we may often hear philosophical adages like “money is not everything” or “money can’t buy happiness”, the fact of the matter is that the entire world is run on money. It plays an important role in determining your lifestyle and gives you access to life necessities. Sometimes in life, we need money for things other than every-day expenses. In such times, you can rely on banks like HDFC Bank, ICICI, Axis Bank, SBI and others to offer you money in return for small rates of interest, which means you, can apply for a personal loan.

What is a personal loan?
Simply put, a personal loan is an unsecured loan which means you do not need the backing for any collateral to procure a loan. Such a loan can be used for funding all your immediate and near future needs, from buying a new cell-phone to home appliances or repairs. Personal loans are usually obtained by people who need immediate funds.

Eligibility and application
Since you do not have to provide any collateral against this loan, you can be eligible for such loans depending upon factors such as your salary, credit history, the amount you borrow etc. Instant personal loans can be sanctioned in minutes and many banks have provisions for you to apply for the loan online. All you need is basic documentation such as address proof, identity proof, salary slips etc. Once your loan is disbursed you can repay the amount in monthly instalments as per the defined loan amount, tenure and rate of applicable interest. Usually, a personal loan can be repaid in 12-60 months.

Types of personal loans available in India

Festival loans: Festive loans are usually provided during the peak festive seasons with very low interest rates. Festival loans are short-term loans and are fantastic for people who need to avail a very small amount of money on loan. However, you must repay the loan in a period of up to 12 months. You can obtain a festival loan for as low as ₹5,000.

Consumer durable loans: You can avail loans to purchase consumer durables like televisions, laptops, refrigerators etc. Depending upon the bank from which you borrow this personal loan you may or may not have to give collateral. You can avail a loan of an amount from ₹5,000 to ₹200,000 that must be repaid in a maximum period of 60 months.

Wedding loans: Weddings cost a lot of money and wedding loans can be acquired to meet several majorexpenses like venue booking, catering services, jewellery and clothing shopping, decorations etc. You may however have to pay 10%-20% interest and can repay the loan in 60 months.


Holiday loans: If you wish to travel within or outside the country, you can also apply for a holiday loan. The loan amount sanctioned depends upon your financial conditions and travel purpose. Holiday loans are instant personal loans which allow you manage your travel bills while your savings remain unaffected.

Top 4 health insurance plans in India worth considering

Often in the news we read about how life has become uncertain due to our modern life style. Whether it is a person who exercises three times a day and maintains a good diet or one who has faulty eating habits, no one is spared from the uncertainties of life. Even healthy people get hospitalized and the high cost of medical fees can mess up your financials. Health insurance plans serve as life savers to such individuals. Such plans provide coverage against hospitalization and other medical problems. Your best bet is to buy a good mediclaim policy to protect yourself from such unforeseen circumstances.

So what should I think about before choosing a health policy?

You also consider the following parameters before choosing your health policies.

• Premiums: look for policies where your premiums are lower, but the coverage is high.
• Co-payment: In such policies, individuals must pay a certain percentage (ideally 10%-20%) of the total hospitalization expense from their own pockets, upon the hospitalization of the person insured.
• No claim bonus: If you’ve not claimed insurance for a certain number of years, the chances of your insurance amount may increase.
• Maximum age period: Good health policies offer coverage for maximum age periods. Such policies cover people in their 60’s, 70’s and even 80’s.
• Wide hospital network: choose polices that offer cashless services or offer reimbursements at a wide network of hospitals.

Best health insurance plans to consider

Religare health insurance care

A comprehensive health insurance plan, Religare care is known for offering multiple benefits such as
• Coverage for expenses on room rent, ICU charges, day care procedures, ambulance charge, medical check-ups, pre/post-hospitalization.
• Coverage against any medical expenses, incurred for treatment at home, for more than 3 consecutive days.
• No upper age limit for enrolment.

HDFC ERGO Health Suraksha - Medical Insurance Plan

HDFC ERGO Health Suraksha- Medical Insurance Plan is among the best health insurance plans. It offers cashless hospitalization access to over 6000+ hospitals and health care centres countrywide and covers the following

• Pre-hospitalization expenses, in-patient treatments, domiciliary treatments and 144 day-care procedures
• Cumulative Bonus benefit on completion of every claim-free year
• Reimbursement on health check-ups after completing 4 years of cash-less service
• No sub-limits on the hospital room rents, hospital charges, specific diseases and doctor fees

Max Bupa Health Companion Health Insurance Plan

With this plan you can opt for a customized insurance policy that suits your different needs. Its main benefits are

• Covers all hospitalization, including pre and post hospitalization
• Customers can avail in-patient treatment up to the base sum insured under Aayush
• Provisions for Daily cash allowance.

Bajaj Allianz Health Guard

Bajaj Allianz Health Guard insurance policy offers the following benefits

• Coverage against pre and post hospitalization expenses including consultations, medicines, investigations, etc. as per the policyholder’s illness
• Lifelong renewability of the plan.
• Cashless facility at over 4000 network hospitals across India

You can purchase all these health insurance plans online but remember to read the fine-print of all plans before purchasing one.

Travel insurance policies – types and benefits

Who doesn’t love to travel? Planning a trip to a new destination is exciting and fun. There is just so much to look forward to. But what do you do if your trip gets plagued with uncertainties. You lose your luggage, misplace your passport, or worse you require medical attention. Even though you may hate to think of these scenarios, when faced with the actual situation, it is worse, especially if you are in a foreign land. Such scenarios lead to lots of stress, not to mention, thrust you into a situation where you end up spending so much more. To avoid these unforeseen scenarios, you need travel insurance.

What is travel insurance and what does it cover?

Travel insurance policies are usually comprehensive policies that insure you for both financial and medical emergencies that may arise while you are travelling, especially abroad. You can choose from different travel policies offering protection for travel to domestic and international destinations. Such policies cover significant things such as loss/delay of checked-in luggage, loss of passport and other important documents and offer cashless hospitalization in case of medical emergencies.

Types of travel insurance

You can choose from three different types of travel policies available in the market viz. single trip insurance, multi-trip insurance and family travel insurance.

Single Trip insurance: Single trip insurance policies are created to cover occasional travellers. Most single trip policies are valid for a period of six months. These policies are best for businessmen and tourists travelling abroad for a limited period of time.

Multi trip insurance: Designed for frequent travellers, multi trip policies are valid for one year and vary depending upon your insurance provider. Such policies are available for people travelling for 30-90 days. This plan helps frequent travellers save money. You just pay the premium once and you are secured for a complete year of travel with no limitations on the number of trips you make in this period.

Family floater plans: These plans are designed to provide comprehensive financial coverage to your entire family on your overseas trip. It covers every single member of your family, and can only be availed under single trip policy for a single premium. The sum assured is shared by family members.

Benefits of travel insurance

Although travel insurance covers a whole plethora of circumstances, here are a few worth considering
• Emergency medical assistance and hospital/medicine costs overseas
• Coverage can be availed anywhere in the world
• Accommodation and travel expenses in case you fall ill abroad and cannot travel back until your health is better
• Cover for your travel partner
• Delay/loss of luggage
• Loss of passport
• Permanent disabilities; you are covered for a period of at least 12 months upon your return home.

Availing insurance

Premiums of policies generally depend upon the destination country and travel duration. You may have to pay higher premiums if you are travelling to countries prone to natural disasters. You can now purchase policies for travel insurance online. Just ensure you fill in all your details correctly, disclosing all relevant information which comes in handy while making claims.

4 important things you must know about fixed deposits

Fixed deposits have always remained a popular investment choice in India. Most people, especially senior citizens prefer to lock their money in fixed deposit accounts owing to their general characteristic of being a safe option, guaranteeing a surety of returns. Many people rely on the monthly interest generated from the FDs as a main or additional source of income. Despite the falling rates of interest on FDs in the past few years, people continue to invest in them. Most people prefer to opt for long-term deposits, purely because they offer far more decent rates of interest than short-term ones. Here are a few things you must know if you’re planning to invest in an FD.

You can choose how your interest is paid: When you fill your FD form you can opt to receive interest either on a monthly or quarterly basis. The money will be credited to your account on a stipulated date mentioned on your FD receipt. Most banks offer an interest rate of 6-8 percent per annum. Senior citizens can get an additional .25-.75% interest on their deposits. A third option for receiving the interest is the cumulative fixed deposit where you can get your entire sum plus the interest only when the FD matures.

You can choose to reinvest your interest: Return on FD and interest received are two separate things. Most people opt to reinvest the interest paid on their FDs. This basically means that you do not make any withdrawal on the interest paid, thus increasing your principal. Let’s say that you opt for quarterly interest payments, but without withdrawing the interest. In this case, your bank will add your interest to your principal amount, and pay you interest on this compounded amount. If you keep repeating this process, your return on interest will be higher. This option is ideal for people who are not dependent on income from their fixed deposits. It therefore makes more sense for them, to opt for reinvestment of interest drawn, to earn higher returns.

Premature withdrawals invoke penalties: At times you may be tempted to break your FD. This could be because you need the money urgently, due to unforeseen circumstances or because another bank is offering a higher rate of interest. Whatever the circumstance, if you break an FD, you must pay the cost attached to it. If you choose to prematurely withdraw the FD, your bank may allow you to make the withdrawal for an interest that is 0.5% lower than the actual applicable interest for the period that the deposit remained with the bank. Some banks also allow premature withdrawals on pro-rata basis.

Interest earned on fixed deposit schemes isn’t tax free: The interest you earn on your FD gets added to the income you earn in a given year. You are therefore taxed according to the tax bracket you fall into. If you fall into the top tax bracket on income through FD, you are taxed at the rate of 33.99%.

National Electronic Fund Transfer – the process and benefits

We live in the age of electronic banking where we don’t have to wait for days for a check to clear or stand in long lines to deposit cash anymore. Ever since the world became accessible on the computer, people are not shying from making the most of its benefits. Net banking has become a common practice. Transferring money to different bank accounts within a matter of seconds has become an everyday activity. One such mode of transferring money online is NEFT or National Electronic Fund Transfer.

What is NEFT?

Like its name suggests, NEFT is a national payment system that allows you to transfer funds to any account on a one-to-one basis. NEFT has emerged as one of the most prominently used online fund transfer systems in India. Several businesses, big corporations and small companies, all rely on NEFT to transfer salaries to their associates. Bank customers can transfer funds securely through an electronic message generated by the system. The facility is available all over the country, in over 30,000 bank branches. You can transfer cash of any amount, without any minimum of maximum limits using NEFT.

How to use NEFT?

Electronic fund transfer can be done very easily. All you need to know is the beneficiary customer’s name and bank details such as the bank’s branch, its IFSC code, the type of account and most importantly, the account number and finally the amount. When this information is fed into the system, it generates a one-time password (in most cases) to your registered phone number, to authenticate the transfer. Once you authorize it, the money is transferred into the beneficiary’s account within a few minutes.

What are the charges for using NEFT?

The bank charges a minimal processing charge for every NEFT. All banks across the country charge the same fees in accordance with the government laws. For instance, if you make an NEFT fund transfer of ₹10,000, you pay a service charge of ₹2.50+applicable GST, whereas for amounts above ₹10,000 you pay ₹5+applicable GST. The maximum amount you pay for using NEFT services is ₹25+GST if you are transferring a sum of up to ₹1,000,000.

Benefits of using NEFT

Secure: With NEFT, you can move money seamlessly and securely form one bank account to another. The money is transferred to the beneficiary account within a matter of minutes. Furthermore, the bank using multiple layers of security, such as the use of OTP mentioned, above to authorize the transfer of funds.

Low service cost: As mentioned before, you can transfer huge amounts of money for negligible costs. You can move money to the tunes of several lakhs, and the service costs much less when compared to archaic money transfer methods like pay orders and demand drafts.

Efficient: One of the greatest advantages of NEFT fund transfers is that it comes in handy in cases of emergency, example huge amount of cash to be paid in a hospital. Since the transfer is co-ordinated by the Reserve Bank of India, you can rest assured that it is extremely reliable.