What is NRI?

Indians living abroad are designated as NRIs (non - resident Indians). If you are an Indian citizen living abroad (NRI) or an OCI card holder (holding a different passport but having a heritage link to India e.g. your parents are Indian or you were born in India) you can avail of India’s NRI banking services to help you bank in India while you are abroad. 

You will be wondering if you need an NRO savings account or an NRE savings account - the answer is yes, you need both! Read on to find out why.

Which account is better for NRI - Difference between NRE and NRO Account

You should get both NRE and NRO accounts as they serve completely different purposes! Therefore, neither is better - it truly is comparing apples to oranges. Here are some aspects that highlight the difference between NRE and NRO account:

  1. Taxation by Indian Authorities - according to Indian law, an NRE account isn’t taxable and is tax-exempt. Therefore, if you are earning interest on deposits in this account, that wealth you create will not be taxed by Indian tax authorities. However, NRO accounts will be taxed by Indian tax authorities as per appropriate tax law. 
  2. Repatriating funds - if you are using an NRE account, you can withdraw your funds from the account to your foreign account (e.g. US bank account) easily and with no limits. With an NRO account, you can do this as well, but only up to $1 million per year - after you cross the $1 million threshold, you will need to get permission from the RBI (which the bank will get for you). 
  3. Where you deposit funds from - if you have income or money in India, you will need to deposit it into a NRO account. If you have foreign earnings that you want to deposit into an Indian bank account, you will need to deposit it into the NRE account. NRE accounts are for foreign deposits, and NRO for Indian deposits. Both accounts are in rupees. 

Open NRE account online

Open NRE Account Online

If you are looking to open NRE account online, you will be disappointed by most banks (there is only one way to open an NRE account online - using North Loop). Most banks in India require you to print forms, make appointments, schedule branch appointments, and take a lot of time to open an account for you. The first and only digital account opening process is via North Loop - which takes 5 minutes to open an NRE account.

NRE Account Minimum Balance

Most banks in India will have a minimum account balance for their NRE accounts. This NRE account minimum balance can range from Rs. 10,000 per month to Rs. 1 lakh per month. Depending on the minimum, you will get different features, fees, interest rates, products etc. The higher the minimum, the better the account (banks reward you for giving them more money). However, in my research, I have found that North Loop provides the ultimate premium account features for zero balance (no account minimum balance) for its NRE Accounts.

NRO Account Benefits

If you are using an NRO account, you will get the following benefits:

  1. Deposit money from Indian earnings
  2. High interest rates on NRO savings account (up to 7%)
  3. International Debit Card
  4. Easy to repatriate (up to $1 million) abroad.

Some banks will also provide other benefits. For example, North Loop is one of the best bank for nri account that will also give you the benefits :

  1. 10% Cashback at some of your favourite restaurants and shops
  2. Investing opportunities across the US and India
  3. Mutual fund investment in India 
  4. Goal -based retirement advisory to ensure you retire with enough money 
  5. US Bank Account
  6. Free remittances to and from India

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