What are the types of NRI Bank Accounts non-residents can open?

Non-residents can open Demat or NRE or NRO Account in Indian Banks.
Demat Account for NRIs:
In the advanced countries, depository systems and services have played a significant role in not only facilitating smooth online share trading and settlement but also attracting foreign investment in capital market. This is exactly what the National Securities Depositories Limited (NSDL) plans to do in India. The depository system as evolved by the NSDL enables investors to overcome all problems related to physical certificates. The Securities and Exchange Board of India (SEBI) regulate the functions of NSDL.
NRE and NRO Accounts:

Non-residents can maintain two types of Rupee Account – Non-Resident (External) Rupee Accounts (NRE Accounts) and Ordinary Non-Resident Rupee Accounts (NRO Accounts). The difference between NRE and NRO Account lies in that the funds remitted from abroad or local funds, which can otherwise be remitted abroad to the account holder, can be credited to NRE Accounts. Local funds, which do not qualify for remittance outside India, are required to be credited to NRO accounts. It may be noted that money may be transferred from NRE to NRO Account but not vice-versa, and money once credited to NRO Account cannot be transferred back to NRE Account as the money becomes non-repatriable. Apart from all this, NRIs can use these accounts to make investment in Indian mutual funds.

Can NRIs returning to India deposit his/their income earned outside India in the Bank?

Yes, Non resident Indians – NRIs that return to India can deposit his or their income earned outside India in the Resident Foreign Currency Account, even if the NRI decides he/she can keep or retain his income earned outside India in any banking channel.

Under this RBI scheme for NRIs who were at point resident outside India for a said continuous period of a minimum one year and became resident after returning back to India are allowed to maintain his account in any freely convertible foreign currency for depositing their income earned outside India.

The following amounts can be kept or deposited in the RFC A/C -

  1. Balances in Bank accounts outside India and interest thereon.
  2. Dividend, interest, profit earned on investment in foreign currency in the form of shares or securities.
  3. Rent etc. earned from Immovable property outside India.
  4. Foreign exchange earning through employment, business or vocation outside India which was taken up while stay abroad.

Can an NRI returning to India keep his money in Bank accounts abroad ?

Yes, non resident indians – NRIs coming back from abroad after a long trip/stay of at least one year or so can maintain and keep their balances in such foreign banks abroad and also maintain their bank accounts without any problems. These NRIs can also deposit all their income that they earn abroad while they were living or were resident of that foreign countries like: USA – United States of America, United Kingdom – UK, Canada, Australia, Gulf- Dubai, UAE, Kuwait, etc. Also to mention that any income earned on any other asset held (immovable like real estate or not) acquired while living abroad or in the foreign land can be deposited in this account. Last but not the least NRIs should keep in mind that, any pension received by such a person from the employers can also be deposited in this bank account held in a foreign country. Any other fresh credits to such type of foreign bank accounts can be made only if it is out of foreign currency acquired from the above mentioned sources.

Are there any provision of repatriating the money held in the bank accounts in India?

RBI guidelines clearly stipulates that only that money invested into India using only designated bank account which are allowed to do repatriations, can only allow repatriating facility. NRE account is one such account that allows NRIs – on resident Indians living abroad to freely take back the money to their residing country. Such a kind of non resident bank account provided by the latest NRI Banking Services does not need any kind of extra permission from the RBI to remit the money abroad; the client (NRI or the PIO) can easily bring back that money back to the foreign country where he/she is residing.However such type of a NRI Bank account called: NRO account does not offer such repatriation facility, but still in some adverse cases the RBI can give permission provided the client gives a legitimate reasoning behind such repatriation to the foreign country. The NRI can take all his money proceedings back to the foreign country, both the principal and the profits generated by the investments in India; however he/she has to pay relevant NRI taxes on the capital gains. The NRI has to mention his designated permanent account number and file his returns on a timely basis to enjoy a hassle free repatriation facility from the banker.

What types of Bank accounts an NRI can open in India?

NRIs – Non Resident Indians can now enjoy online NRI banking services various top notch banks in India. The two most popular bank account for NRIs these days are:
1. NRE Bank Account: NRE Stands for Non Residential External Account.
2. NRO Bank Account: NRO Stands for Non Residential Ordinary Account.
Both these accounts are saving type account for NRIs living around the globe, and they can be opened in both individual and joint status.
NRE Bank account provides you a repatriable facility. This means any investment from this account would be subjected to repatriation of funds back to the country in which the non resident Indian is residing. For example if an NRI, PIO or an OCI uses such an account to invest 5 lacs in Indian mutual fund, and happens to generate a capital gain of Rs.2 lacs over a period of 2 years. Then the NRI has all the right to take back the principal along with the profit back to his foreign country where he is residing.
NRO Bank account does not provide repatriation facility. However in certain cases the principal along with the capital gains can be remitted outside of India, but for that special permission needs to be taken by the RBI – reserve bank of India.
Besides such account, there is one more account which is becoming popula among the NRIs is the FCNR account. FCNR stands for Foreign Currency Non Residential Account, such type of an account can be open by an NRI where in he can keep his deposits in a foreign currency without getting them converted into rupees.