When you move overseas for education, employment, or business-related purposes, your citizenship status changes from a resident to a non-resident Indian. Moving overseas comes with a lot of excitement and nervousness. Prepare a checklist to ensure you do not miss anything. Since money matters the most, make sure you get your banking and finances sorted before migrating.
NRI Account opening should be at the top of your checklist. The Foreign Exchange Management Act indicates that NRIs cannot bank through a Resident Bank Account. Hence, opening an NRI Account is necessary to continue banking. Furthermore, it offers several services that cater to the specific banking and financial needs you have as an NRI.
There are three primary types of NRI Accounts: Non-Resident Ordinary, Non-Resident External, and Foreign Currency Non-Resident. Let us understand who can open an NRO Account.
Who can open an NRO Account?
You can open an NRO Account if you are an NRI, a Person of Indian Origin, or an Overseas Citizen of India. Visit your bank or log in online to open an NRO Savings Account. Typically, you need to fill out a form and submit a set of documents to open the account. This takes a few minutes. The bank verifies the information filled out in the account opening form and confirms the provided documents.
The bank’s customer representative approaches you in case of queries or additional document requirements. Upon satisfactory verification, the bank opens your account.
Who should open an NRO Account?
Consider opening an NRO online if you have the following banking and financial requirements:
- Income sources in India
While you would move overseas to pursue education or employment, you would hold investments and assets in India. These would generate regular returns. Parking these returns in the right place is important to ensure their safekeeping. Consider opening an NRO Account to secure your investment and asset income in India.
Besides securing your Indian income, the NRO Account also earns you a competitive NRO Account interest rate. You benefit from opening an account in every way.
- Access banking and financial products
Suppose you invest in Mutual Funds or other investment options in India. How to do so? An NRO Account lets you access a range of banking and financial products. This means, whether you wish to invest or buy an Insurance Plan, you simply need to login to your NRO Account.
While an NRO Account confers several benefits, it has a few limitations. You cannot deposit foreign currency income in an NRO Account. You need an NRE Account for that. NRO Account interest income is taxable. Repatriation through the account is subject to restrictions.
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