What are NRE vs NRO vs FCNR Accounts?

 

What are NRE vs NRO vs FCNR Accounts?

 

There are mainly three types of bank accounts available for money deposits by Non Resident Individuals (NRIs) in India.

 

1) NRE 

2) NRO

3) FCNR

 

Let's understand each of these.

 

NRE Account 

 

Ø NRE stands for Non-Resident External Account.

 

Ø A NRE Account is an account in which you can deposit your foreign earnings (income earned from abroad).

 

Ø As NRE Account is maintained in INR, the foreign currency earnings deposited by you will be converted to INR at the applicable exchange rate.

 

Ø You can avail NRE Account as Saving Account, Current Account as well as for Term Deposits.

 

Ø The Deposits as well as interest earned in NRE Account is fully repatriable.

 

Ø Here withdrawals are allowed only in INR.

 

NRO Account 

 

Ø NRO stands for Non-Resident Ordinary Account.

 

Ø A NRO Account is an account in which you can deposit your Indian earnings (Income earned from India).

 

Ø You can deposit funds either in Indian Currency or Foreign Currency in NRO Account.

 

Ø As NRO Account is maintained in INR, the foreign currency deposited by you will be converted to INR at the applicable exchange rate.

 

Ø You can avail NRO Account as Saving Account, Current Account as well as for Term Deposits.

 

Ø In NRO Account, you can maximum repatriate upto $1 Million (USD) in a financial year.

 

Ø Here withdrawals are allowed only in INR.

 

FCNR 

 

Ø FCNR stands for Foreign Currency Non-Resident Account.

 

Ø A FCNR Account is an account in which you can deposit your foreign currency funds in foreign currency itself.

 

Ø Meaning as opposed to NRE & NRO accounts which are maintained in INR only, FCNR allows deposits to be made in foreign currency.

 

Ø FCNR accounts accept deposits in various currencies such as USD, GBP, AUD, SGD, HKD, etc.

 

Ø You can avail FCNR Account for Term Deposits only.

 

Ø The tenure of these deposits can be between 1 year to 5 years.

 

Ø The Deposits as well as interest earned in FCNR Account is fully repatriable.

 

Ø Here withdrawals are allowed in Foreign Currency.

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