– Foreign currency accounts
• The different types of rupee accounts a nonresident may have are:
– Nonresident (ordinary) (NRO) account
– Nonresident external (NRE) account.
• There were two other types earlier – the Nonresident Non Repatriable (NRNR) and the
Nonresident Special Rupee (NRSR) account. These have been discontinued with effect
from April 1, 2002 and September 30, 2002 respectively.
Nonresident (ordinary) account
• The account that an Indian has in India is converted to an NRO account when he
emigrates or goes abroad to work except if he goes to Nepal or Bhutan.
• Nonresidents may open accounts designated as NRO for receiving monies in Indian
• Bangladeshis and Pakistanis require RBI approval to open this account.
• The monies in these accounts represents rupee funds/ earnings in India.
• These can be savings, current, recurring or fixed deposit accounts.
• These may be opened jointly with Indian residents or other nonresidents.
• Credits may be from foreign remittances, travelers cheques, foreign currency, proceeds
of foreign currency nonresident (FCNR) deposits or nonresident external (NRE)
deposits or all legitimate dues in India like rents, dividends and the like.
• Account holders should give an undertaking that the credits and debits in the account
will be in accordance with Reserve Bank of India (RBI) regulations.
• Funds from these accounts are not normally repatriable unless specifically permitted by
RBI such as current income.
• Remittances made would be after deduction of applicable taxes.
• Interest on savings accounts are at the same rate as resident accounts.
• Upto $1 million can be repatriated for education, sale proceeds of immoveable property,
medical expenses and the likes.
• This can also be used to pay on monies spent on International Credit Cards.
Nonresident (external) account
• This has to be opened with convertible foreign exchange.
• Withdrawals are permitted for local payments, transfer to NRE/ FCNR accounts and