Non-Resident External Account

NON RESIDENT INDIAN ( NRI ) :

Foreign Exchange Management Act (FEMA) defines a Non-Resident as a person who is not resident in India, a person resident outside India who is a citizen of India or is a person of Indian origin.

Features: One can open following accounts :

• NRE Saving / Current Account.
• NRE Fixed Deposit in Indian Rupees ( NRE Time Deposit ).

Transactions in NRE Accounts: 

• Proceeds of remittances to India in any permitted Currency.
• Proceeds of Foreign Currency/Bank Notes tendered by Account Holder during his temporary visit to India.
• Transfer from other NRE / FCNR (B) Accounts.
• Interest accruing on the funds held in the Account.

Credit of Current Income of NRIs :

Authorized Dealers may credit the current income like Rent, Dividend, Pension, Interest etc of NRIs to their Non- Resident (External) Rupee accounts provided they are satisfied that the credit represents current income of the non-resident account holder and income tax thereon has been deducted/paid/provided for, as the case may be.

Debit in NRE Accounts :

• Local disbursements.
• Remittances outside India.
• Transfer to NRE/FCNR (B)/ NRO Accounts of the Account Holder or any other person eligible to maintain such Account.
• Investment in Shares/Securities/Commercial Paper of an Indian company or for the purchase of immovable property in India provided such investment/purchase is covered by the Regulations of the general/special permission granted, by Reserve Bank of India.
• Any other transaction if covered under general or special permission granted by the Reserve Bank of India.