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Understanding NRI Bank Accounts

Most individuals make a mistake of continuing a resident savings account even after becoming a NRI but the law does not allow it. Or in simple words it’s illegal to hold savings bank account for NRIs.

As per FEMA regulation, when a status changes to NRI the resident savings account have to be converted to a Non-Resident account.

Types of NRI bank accounts

An NRI can choose from two options : an NRE or an NRO account. It would be advantageous to know how these two types of accounts differ and which one is right for you.

What is an NRE account?

What is an NRO account?

Which account should you choose?

Choose NRE account if you:

Choose NRO account if you:

All income which is receivable in India such as rentals from property, investments, pension etc has to be deposited in NRO account.

Any payment towards insurance premiums or EMIs on loans which you availed while in India also has to be mandated from NRE/NRO account.

Any investment you make in India can be funded from NRE/NRO account.

Both accounts can be opened as Savings as well as Current accounts and are Indian Rupee accounts.

– Aneesh V / NRICafe.com