Non- Resident Ordinary (NRO) Bank Account

NRO is a term that stands for Non-resident Ordinary. It is a type of NRI bank account. There are several NRIs Non-resident Indians who have an overseas income and also making money in India. If you are among them then an NRO bank account is the best for you to manage your earnings, investments, and expenses in India.

If you are an NRI and want to open an NRO bank account in India then it is a perfect place to know more about this. In this blog, we will discuss What is NRO bank account is, its benefits, limitations, and more. So to learn more about Non-resident Ordinary accounts stay tuned with us. Let’s begin with the question: what is an NRO bank account?

What is an NRO account?

Do you have a wish to deposit rent, dividends, pensions, gifts, and the amount earned by sales of immovable property from India in your account? If yes then the NRO bank account is perfect for you. It is a type of NRI bank account and is dominated by Rupee bank accounts and Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs) can deposit their money in it.

According to FEMA (Foreign Exchange Management) Act if you get an NRI status then it is essential to convert your existing bank account into a NRO bank account. Apart from this if you want to open a new Non-resident Ordinary account without converting your previous one. Then several banks allow you to hold multiple NRO accounts.

Besides this, there are multiple categories of non-residential rupee ordinary. Such as current, saving, recurring, fixed deposit, and many more. So after knowing the NRO is detailed we will move forward and check out the benefits of the NRO account.

Benefits of Non-Resident Ordinary Bank Account:

It is important to understand the benefits before opening any bank account. So if you are going to open a NRO account then become familiar with its benefits that are mentioned below.

Safeguarding earnings:

There are ample Non-resident Indians (NRIs) who have domestic earning sources. Including rented property, dividends, stock market investments, and many more. These types of funds can be deposited to financial institutions through an NRO account only. By opening the NRO account in any bank of India you will get an assurance to keep your total earnings accrued domestically safe.

Increased credit availability:

If you are an NRI and want loans for any emergency expenses either in India or in the country of your residence NRO is best. Any non-resident Indians can apply for loans against NRO fixed deposits. To get the loan you need a loan then Since these lines of credit are provided against collateral (e.g. NRO FD), the rate of interest is also low.

Multiple account holders:

When we talk about the benefits of an NRO account then it is one of the primary advantages of it. Two or more people can open a Joint NRO bank account but the condition is that at least one of them is NRI/OCI/PIO and the other will be an Indian. Besides this, if you and your co-applicant both live outside India then you can choose any individual living in India to make his /her the power of attorney for operating an account domestically.

Ease of investment:

Another benefit for every individual of having an NRO account is ease of investment. NRIs will get safe and assured returns on the investment in term deposits. Alongside NRO fixed deposit account covers up to Rupees 1 lakh by the government of India.

As we all know every coin has two sides and so by keeping this in mind let’s lighten up the NRO account limitations.

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Limitations of NRO accounts

Non-resident ordinary accounts are not meant to save money earned from Abroad. To save money, an NRI also needs to open an NRE account.

NRO accounts cannot be used to hold foreign exchange; it is only used to deposit the earnings from India.

Non-resident Ordinary accounts are subject to tax liabilities.

These are some of the limitations of NRO accounts. Next, we will shed light on the required documents to open this account in Indian banks.

List of Documents Required for NRO Account.

• Fully filled-in application form.
• A copy of the passport of the NRI.
• Visa or residence permit of the applicant.
• Depending on the financial institution, 2/3 copies of passport-sized photographs of the applicant.
• Money remittance details of the applicant.

Eligibility Criteria for NRO Bank Account:

Residential status: NRI, PIO, and OCI

Transaction currency: INR

Joint account: Joint applicant can be NRI or residential Indian

Power of attorney: Residential Indian

Summing it Up:

With the help of this blog on NRO bank account readers will get to know the detailed overview of this type of NRI account. Above we discussed what an NRO account is, its benefits, limitations, and required documents. Still, if you are facing any issues then we strongly recommend you to connect with Visament. They will help you in the process of opening an NRO account. By which applicants can open an account with ease and hassle-free.