For Non-Resident Indians (NRIs), managing finances can be difficult due to the cross-border transactions involved. A practical solution to address these unique challenges is opening an NRI bank account. No matter if it’s for investments, savings, or day-to-day transactions related to property and business dealings in India, an NRI account is a must-have financial tool for NRIs.
Discussed below are the top reasons that explain why it makes sense to open an NRI bank account today!
Convenience in Managing Funds
NRIs often have income sources in multiple countries, including salaries, rental income, and investment returns. An NRI account supports seamless fund transfers from abroad to India and makes it easier to handle these diverse income streams. There are primarily three types of NRI accounts:
Non-Resident External (NRE) account
Ideal for those who want to park their foreign earnings in India. The funds in this account are fully repatriable, and the interest earned is tax-free in India.
Non-Resident Ordinary (NRO) account
Many NRIs earn income in India through various sources like rental properties, dividends, or investments. An NRO bank account simplifies the management of such income.
Foreign Currency Non-Resident (FCNR) account
This account helps you maintain your deposits in foreign currency and protects against currency fluctuation risks.
3Open and Manage Your NRI Account Online 24/7
The IndusInd Bank NRI Account gives you the flexibility to complete the account opening process from anywhere with a simple online method. No hassles of multiple bank visits, lengthy paperwork, or administrative delays. Simply apply digitally, and the bank will open your account instantly. Now, enjoy a competitive NRI account interest rate and exclusive services.
The best part is that you get access to best-in-class digital banking services like net banking, mobile banking, and a video branch. You can easily conduct transactions, check balances, track the funds’ growth, and access customer support at your convenience.
Open an NRI account and get started with IndusInd Bank today! Enjoy premium NRI banking features and a world of convenience at your fingertips!
Tax Benefits of NRI Accounts
NRE accounts are funded with foreign currency earned abroad. Any interest earned on NRE accounts is fully exempt under Section 10(4)(ii) of the Income Tax Act, 1961, without any limit. This allows your money to grow faster as the entire interest amount is reinvested and takes full advantage of compound interest.
Note that interest earned on an NRO account is subject to Indian income tax.
Access to FCNR deposits
FCNR deposits are a special type of deposit account that allows NRIs to save in major foreign currencies like USD, GBP, EUR, JPY, CAD, or AUD. You can open an FCNR account by transferring money from your NRE account.
You get an opportunity to earn competitive rates and additional benefits like:
● Both the principal amount and the interest earned on FCNR deposits are fully and freely repatriable.
● There are no Indian income tax obligations on interest earned from FCNR deposits.
● The interest on FCNR deposits is compounded every 180 days, which could lead to potentially higher returns over time.
● You can open FCNR deposits for a period ranging from one to five years.
● Protect your funds from exchange rate fluctuations by holding deposits in major foreign currencies.
Repatriation Advantages
Repatriation of funds refers to the process of transferring money from an NRI’s account in India back to their resident country. NRI bank accounts, particularly NRE and FCNR accounts, allow for easy and hassle-free repatriation of funds. You can freely repatriate both the principal amount you deposit, and the interest earned without any restrictions.
NRO accounts, however, have some limitations. As per the regulations of the Foreign Exchange Management Act (FEMA), an NRI or Person of Indian Origin (PIO) is allowed to repatriate up to $1 million per financial year (April-March) from their NRO account balances.
This limit applies to all remittances from non-current income during the financial year. However, there is no restriction on the remittance of current income (like rent, dividend, pension, or interest income) abroad from an NRO account.
Investment Opportunities
To invest in India, having an NRI bank account is essential, as Indian Asset Management Companies (AMCs) cannot accept foreign currency investments. An NRI accountallows you to invest in mutual funds, fixed deposits, real estate, and the stock market without having to convert any currency. This makes it easier to diversify your portfolio and capitalise on the robust growth potential of the Indian economy.
Key Takeaways
Opening an NRI bank account is a smart decision that offers countless benefits. These include efficient management of income, tax advantages, ease of repatriation, investment opportunities, and access to diverse financial products and services. By simplifying the management of your funds domestically and internationally, these accounts maximise your financial potential while keeping you compliant with regulatory requirements.
Now that you know all the ways an NRI account can benefit you, why wait any longer? Initiate the NRI account opening process online today!
