NRI

Can NRI have savings account in India


NRI, or Non-Resident Indians, are allowed to open savings accounts in India. In fact, NRI savings accounts are designed specifically to meet the needs of NRIs who have left India, but still have financial interests in the country.

NRI savings accounts can be opened with both public and private sector banks in India.

The process for opening an NRI savings account is similar to that of opening a regular savings account, with a few additional steps.

For example, NRIs will need to provide proof of their foreign address and occupation, as well as documents such as a passport, visa, and recent income tax returns.

In addition to offering access to funds, NRI savings accounts can also provide a number of advantages, such as interest rates that are higher than those available to domestic customers, and the ability to transfer funds quickly and easily between countries.

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Furthermore, NRI savings accounts may come with special features such as overdraft protection and the ability to open joint accounts with other NRIs.

In order to open an NRI savings account, an individual must first be classified as an NRI according to Indian law. This requires them to be a citizen of another country and to have stayed outside India for at least 182 days in the previous financial year.

Overall, while NRIs are allowed to open savings accounts in India, they should make sure to research the various options available and understand the associated regulations before doing so.

Can NRI hold a regular savings account in India?

Yes, NRIs can open and hold a regular savings account in India. The Reserve Bank of India (RBI) allows Non-Resident Indians (NRIs) to open a NRE (Non-Resident External) or NRO (Non-Resident Ordinary) savings account in India.

NRIs are allowed to open these accounts for the purpose of making remittances from abroad, repatriating funds held in India, and to maintain their savings in India. NRIs can deposit funds in Indian rupees or foreign currencies in these accounts.

The NRE savings account is designed to allow NRIs to deposit their earnings from abroad and enjoy tax benefits on the interest earned on their deposits. Any income earned in India is subject to Indian income tax laws.

The NRO savings account allows NRIs to manage their income earned in India, such as rental income, dividend, pension, etc. All deposits made in this account are subject to Indian income tax laws.

In addition, NRIs can open a Foreign Currency Non-Resident (FCNR) account, which is used for foreign currency deposits.

The FCNR account is a beneficial account for NRIs who want to invest their foreign currency earnings in India. This account offers attractive interest rates and tax benefits.

What happens if NRI has savings account in India?

If an NRI has a savings account in India, they will be subject to the same rules and regulations as any other Indian citizen.

This includes filing annual income tax returns, reporting foreign income, and paying taxes on any interest earned from their account. Furthermore, any withdrawals of funds from the account must be reported to the relevant authorities.

In addition, NRIs are also expected to comply with India’s Foreign Exchange Management Act (FEMA), which regulates the conversion of foreign currency into Indian rupees.

This means that if the NRI wishes to withdraw funds from their savings account in Indian rupees, they must first convert the money into Indian rupees at an authorized exchange house.

Finally, it is important to note that the Reserve Bank of India (RBI) requires all NRIs to provide proof of their identity and address when opening or maintaining a savings account in India.

The bank may also require additional information such as occupation, source of income, and other financial details. Failure to provide this information can result in the account being frozen or closed.

What’s the penalty for keeping savings accounts and deposit accounts as an NRI?

For an NRI (Non-Resident Indian) to keep a savings or NRE account in India, there is no penalty for doing so. However, the NRI must be aware of the tax implications of having such accounts in India.

Income earned from any savings or NRE account held by an NRI in India is taxable under the Income Tax Act 1961. The income earned from interest on deposits held in savings and NRE accounts will be subject to taxation at the applicable rate as per the Income Tax Act.

The other important aspect to note here is that the NRI must declare their income from these accounts on their annual income tax returns. Failure to do so can attract a penalty from the government.

It is also important to note that NRIs are not allowed to hold a fixed deposit account in India. This is because fixed deposits are considered to be an investment made in the Indian capital market which is not allowed for NRIs.


I'm an Entrepreneur, Blogger & Mentor. Having lived in the USA for almost 7 years, I got bored and returned back to India. While doing so, created this website as a way to curate and journal my experiences. Today, it's a movement with a large community behind it. I hope this website helps NRIs planning to move back to India, make their transition smooth and easy. Feel free to ask any questions you may have. Happy to help!

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