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FOREX FACILITIES FOR NRIS/PIOS

If you are a Non-Resident Indian (NRI) or a Person of Indian Origin (PIO), you can avail of the following facilities
without permission from the Reserve Bank :

Deposits

• You can open, hold and maintain following types of accounts with an authorised dealer in India i.e. a bank
authorised to deal in foreign exchange.

Non-Resident (Ordinary) Rupee Account – NRO Account

Non-Resident (External) Rupee Account – NRE Account

Foreign Currency Non Resident (Bank) Account – FCNR (B) Account

• Salient features of the above accounts are as under :

Particulars FCNR (B) Account NRE Account NRO Account

Joint account of two or Permitted Permitted Permitted
more NRIs
Joint account with Not permitted Not permitted Permitted
another person resident
in India
Currency in which Pound Sterling/ US Indian Rupees Indian Rupees
account is denominated Dollar/Jap.Yen/Euro
Repatriability –
Principal
Freely repatriable Freely repatriable Not repatriable

(except current
income like rent,
dividend, pension etc.
and remittances
indicated under
"Repatriation of NRO
Funds")
Interest Freely repatriable Freely repatriable Freely repatriable
Foreign currency risk Account holder is Account holder is Account holder is
protected against exposed to the exposed to the
changes in INR value fluctuations in the fluctuations, in the
vis-à-vis the currency value of INR. value of INR to the
 in which the account extent of interest
is denominated. amount.
Type of accounts Term deposits only. Current, Savings, Current, Savings,
Recurring, Fixed Recurring, Fixed
Deposits. Deposits.
Period of fixed For terms not less For the periods as For the periods as
deposits than 1 year and not announced by the announced by the
exceeding 3 years deposit taking bank. deposit taking bank.
Rate of interest Banks are free to Banks are free to Banks are free to
determine interest determine interest determine interest
rates within the rates. rates.
ceiling, if any,
prescribed by the
Reserve Bank
Rupee Loans in India
against Security of the
funds held in the
account to :
Account holder Permitted Permitted Permitted
Third Party Permitted Permitted Permitted
Foreign currency loans
outside India against
security of the funds
held in the account to :
Account holder Permitted Permitted Not permitted
Third Party Permitted Permitted Not permitted

• Only account holders can avail of foreign currency loans in India against the security held in FCNR(B)
Deposit Account.

Repatriation of NRO funds

• Authorised Dealers can allow remittance/s upto USD 1 million, of balances in NRO accounts/of sale
proceeds of assets on production of an undertaking by the remitter togetherwith a certificate issued by a
Chartered Accountant in Annexure A and B as prescribed by the Central Board of Direct axes (CBDT). In
the case of repatriation of sale proceeds of immovable property by NRIs/PIOs, ADs can allow repatriation
thereof even if the immovable property was held by the NRIs/PIOs for less than 10 years provided the
cumulative period of holding of the immovable property in India and retention of the sale proceeds of the
property in the NRO Account is not less than 10 years.

Investment in India :

You can invest in :

• Government Securities/Units with repatriation rights.

 • Company shares/Debentures with repatriation rights.

• Shares/debentures of Indian companies through stock exchange under port-folio investment scheme with
repatriation rights.

• Indian companies without any limit on non-repatriation basis, freely.

For details please refer to Reserve Bank’s Notifications No.FEMA.20/RB-2000 and No.FEMA.24/RB-2000 dated
May 3, 2000 as amended from time to time.

Immovable property

You can acquire –

• immovable property in India other than agricultural/plantation property or a farm house, if you are an
NRI.

• immovable property other than agricultural land/farm house/plantation property in India out of repatriable
funds, if you are a PIO.

You can repatriate –

• sale proceeds of immovable property acquired in India out of your repatriable funds, without any lock-in
period.

• refund of application/earnest money/purchase consideration made by house-building agencies/seller on

account of non-allotment of flats/plots/cancellation of booking/deals for purchase of
residential/commercial properties, togetherwith interest, net of taxes, provided original payment is made
out of NRE/FCNR(B) account/inward remittances.

N.B. - All persons, whether resident in India or outside India, who are citizens of Pakistan,
Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal, or Bhutan, require prior permission of
Reserve Bank for acquiring or transferring any immovable property in India.

On return to India

If you decide to return to India :

• You may continue to hold, own, transfer or invest in foreign currency, foreign security or any immovable
property situated outside India, if such currency, security or property was acquired, held or owned when
you were resident outside India.

• You may open, hold and maintain with an authorised dealer in India a Resident Foreign Currency (RFC)
Account to keep your foreign currency assets. Assets held outside India at the time of return can be
credited to RFC account. The funds in RFC accounts are free from all restrictions regarding utilisation of
foreign currency balances including any restriction on investment outside India.

N.B. All the above facilities are available under general permission, i.e., foreign exchange can be availed of from
authorised dealers and does not require Reserve Bank’s approval.