Features of various Deposit Schemes available to Non-Resident Indians (NRIs)

Particulars	Foreign Currency (Non-Resident) Account (Banks) Scheme [FCNR (B) Account]	Non-Resident (External) Rupee Account Scheme [NRE Account]	Non-Resident Ordinary Rupee Account Scheme [NRO Account]
Who can open an account	NRIs (individuals / entities of Bangladesh / Pakistan nationality / ownership require prior approval of RBI)	NRIs (individuals / entities of Bangladesh / Pakistan nationality/ownership require prior approval of RBI)	Any person resident outside India (other than a person resident in Nepal and Bhutan). Individuals / entities of Pakistan nationality / ownership, entities of Bangladesh2 ownership and erstwhile Overseas Corporate Bodies5 require prior approval of the Reserve Bank.
Joint account	In the names of two or more non-resident individuals provided all the account holders are persons of Indian nationality or origin; Resident close relative (relative as defined in Section 6 of the Companies Act, 1956) on ‘former or survivor’ basis. The resident close relative shall be eligible to operate the account as a Power of Attorney holder in accordance with extant instructions during the life time of the NRI/ PIO account holder.	In the names of two or more non-resident individuals provided all the account holders are persons of Indian nationality or origin; Resident close relative (relative as defined in Section 6 of the Companies Act, 1956) on ‘former or survivor’ basis. The resident close relative shall be eligible to operate the account as a Power of Attorney holder in accordance with extant instructions during the life time of the NRI/ PIO account holder.	May be held jointly with residents
Nomination	Permitted	Permitted	Permitted
Currency in which account is denominated	Any permitted currency i.e. a foreign currency which is freely convertible	Indian Rupees	Indian Rupees
Repatriablity	Repatriable	Repatriable	Not repatriable except for the following: i) all current income and ii) up to USD 1 (one) million per financial year (April-March), by A NRI/ PIO.
Type of Account	Term Deposit only	Savings, Current, Recurring, Fixed Deposit	Savings, Current, Recurring, Fixed Deposit
Period for fixed deposits	For terms not less than 1 year and not more than 5 years.	From one to three years, However, banks are allowed to accept NRE deposits above three years from their Asset-Liability point of view	As applicable to resident accounts.
Rate of Interest	With effect from March 1, 2014 (i)deposits of 1 year to less than 3 year maturity, interest shall be paid within the ceiling rate of LIBOR/ SWAP rates plus 200 basis points; (ii) deposits of 3-5 years maturity, interest shall be paid within the ceiling rate of LIBOR/ SWAP rates plus 300 basis points On floating rate deposits, interest shall be paid within the ceiling of SWAP rates for the respective currency /maturity plus 200 bps/ 300 bps as the case may be. For floating rate deposits, the interest reset period shall be six months.	With effect from March 1, 2014, interest rates offered by banks on NRE deposits cannot be higher than those offered by them on comparable domestic rupee deposits.	Banks are free to determine their interest rates on savings deposits under Ordinary Non-Resident (NRO) Accounts. However, interest rates offered by banks on NRO deposits cannot be higher than those offered by them on comparable domestic rupee deposits.
Operations by Power of Attorney in favour of a resident by the non-resident account holder	Operations in the account in terms of Power of Attorney is restricted to withdrawals for permissible local payments or remittance to the account holder himself through normal banking channels.	Operations in the account in terms of Power of Attorney is restricted to withdrawals for permissible local payments or remittance to the account holder himself through normal banking channels.	Operations in the account in terms of Power of Attorney is restricted to withdrawals for permissible local payments in rupees, remittance of current income to the account holder outside India or remittance to the account holder himself through normal banking channels. Remittance to the NRI/ PIO account holder is subject to the ceiling of USD 1 (one) million per financial year.
Loans	-	-	-
a. In India	-	-	-
i) to the Account holder	Permitted without any ceiling subject to usual margin requirements.	Permitted without any ceiling subject to usual margin requirements	Permitted subject to the extant rules3
ii) to Third Parties	Permitted without any ceiling subject to usual margin requirements.	Permitted without any ceiling subject to usual margin requirements.	Permitted, subject to conditions4
b. Abroad	-	-	-
i) to the Account holder	Permitted	Permitted	Not Permitted
ii) to Third Parties	Permitted	Permitted	Not Permitted
c. Foreign Currency Loans in India	-	-	-
i) to the Account holder	Permitted without any ceiling subject to usual margin requirements.	Permitted without any ceiling subject to usual margin requirements.	Not Permitted
ii) to Third Parties	Permitted without any ceiling subject to usual margin requirements	Permitted without any ceiling subject to usual margin requirements	Not Permitted
Purpose of Loan	-	-	-
a. In India	-	-	-
i) to the Account holder	i) Personal purposes or for carrying on business activities * ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 9 of Schedule 2 to FEMA 5).	i) Personal purposes or for carrying on business activities.* ii) Direct investment in India on non-repatriation basis by way of contribution to the capital of Indian firms / companies. iii) Acquisition of flat / house in India for his own residential use. (Please refer to para 6(a) of Schedule1 to FEMA 5).	Personal requirement and / or business purpose.*
ii) to Third Parties	Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Please refer to para 9 of Schedule 2 to FEMA 5).	Fund based and / or non-fund based facilities for personal purposes or for carrying on business activities *. (Please refer to para 6(b) of Sch. 1 to FEMA 5)	Personal requirement and / or business purpose *
b. Abroad	-	-	-
To the account holder and Third Parties	Fund based and / or non-fund based facilities for bonafide purposes.	Fund based and / or non-fund based facilities for bonafide purposes.	Not permitted.

* The loans cannot be utilised for the purpose of on-lending or for carrying on agriculture or plantation activities or for investment in real estate business.

Note:

a: When a person resident in India leaves India for Nepal and Bhutan for taking up employment or for carrying on business or vocation or for any other purpose indicating his intention to stay in Nepal and Bhutan for an uncertain period, his existing account will continue as a resident account. Such account should not be designated as Non-resident (Ordinary) Rupee Account.

b: Authorised Dealers (ADs) may open and maintain NRE / FCNR (B) Accounts of persons resident in Nepal and Bhutan who are citizens of India or of Indian origin, provided the funds for opening these accounts are remitted in free foreign exchange. Interest earned in NRE / FCNR (B) accounts can be remitted only in Indian rupees to NRIs and PIO resident in Nepal and Bhutan.

c: In terms of Regulation 4(4) of the Notification No.FEMA.5/2000-RB dated May 3, 2000, ADs may open and maintain Rupee accounts for a person resident in Nepal and Bhutan.

d: The regulations relating to the various deposit schemes available to Non-Resident Indians have been notified vide Notification No.FEMA.5 dated 3rd May 2000, as amended from time to time. The relevant Notifications and A.P. (DIR Series) Circulars are available on our website [www.rbi.org.in → Sitemap → FEMA → Notifications / A.P.(DIR Series) Circulars]. The Master Circular on Non-Resident Ordinary Rupee (NRO) Account [www.rbi.org.in → Sitemap → Master Circulars] may also be referred to. The details of rate of interest on the various accounts, are available in the “Master Circular on Interest Rates on Rupee Deposits held in Domestic, Ordinary Non-Resident (NRO) and Non-Resident (External) (NRE) Accounts” and “Master Circular of instructions relating to deposits held in FCNR (B) Accounts”issued by our Department of Banking Operations and Development, available on our website [www.rbi.org.in → Sitemap → Master Circulars].

e: AD Category – I banks and authorized banks may credit the proceeds of account payee cheques/ demand drafts / bankers' cheques, issued against encashment of foreign currency to the NRE account of the NRI account holder where the instruments issued to the NRE account holder are supported by encashment certificate issued by AD Category-I / Category-II.

f: AD Category – I banks and authorised banks may permit remittance of the maturity proceeds of FCNR (B) deposits to third parties outside India, provided the transaction is specifically authorised by the account holder and the Authorised Dealer is satisfied about the bonafides of the transaction.

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