What is NRO Account?

The NRO full form is Non-Resident Ordinary. This is the type of account that is specifically designed for Non-Resident Indians (NRIs) and only deals in Indian Rupees. The NRO a/c provides banking services in India for NRIs, managing income earned within the country or from Indian sources. This income can include rent, interest, pensions, or earnings from business returns and investments. An NRO account allows you to receive funds in either Indian or foreign currency.

NRO accounts can be opened in various formats, such as savings accounts, fixed deposits, or recurring deposit accounts. NRIS need to open an NRO account because, upon gaining NRI status, they cannot open a regular savings account in India. They must either convert their existing account or open a new NRI account. Additionally, an NRO account means higher interest rates compared to standard savings accounts, which can help in building more savings.

Features of an NRO Account?

Here are some of the features of opening an NRO account: 

• Through an NRO account, you can transfer the interest earned on the deposited principal amount. 
• You can also transfer the principal amount with some limits. 
• You can transfer up to 1 million USD in a financial year after applicable taxes. 
• On an NRO account, the interest is taxable up to 30% deductible at source. 
• The Income earned in India deposited in the NRO account includes pension, interest, dividends, etc. 
• NRO account is an ideal option if you are getting income earned in India and want to manage in India. 

How to Open an NRO Account

1. Choose Bank – Select a bank in India that offers NRO account services.
2. Complete the application form – Fill out the bank's NRO account opening form with accurate personal details.
3. Submit required documents – Provide necessary documents such as:
4. Meet bank-specific conditions – Some banks may require additional documents like an Overseas Citizen of India (OCI) or Person of Indian Origin (PIO) card.
5. Initial funding – Deposit the minimum required amount to activate the account, as specified by the bank.