Resident Indians (NRIs) and Persons of Indian Origin (PIOs)
can open and maintain NRE accounts with authorized dealers and
with banks (including co-operative banks) authorized by the
Reserve Bank of India (RBI) to maintain such accounts.
account has to be opened by the Non Resident account holder
himself and not by the holder of the power of attorney in
NRE accounts in the names of individuals / entities of
Bangladesh / Pakistan nationality / ownership requires
approval of RBI
of Accounts - Savings, Current, Recurring or Fixed Deposit
Payments for local expenses and investments are allowed
freely. Credits to an account, of funds emanating from a local
source would be permissible only if the funds are of a
of remittances to India can be in any permitted currency.
of personal cheques drawn by the account holder on his
foreign currency account and of travellers cheques, bank
drafts payable in any permitted currency including
instruments expressed in Indian rupees for which
reimbursement will be received in foreign currency,
deposited by the account holder in person during his
temporary visit to India, provided the authorised
dealer/bank is satisfied that the account holder is still
resident outside India, the travellers' cheques/drafts are
standing/endorsed in the name of the account holder and in
the case of travellers' cheques, they were issued outside
of foreign currency/bank notes tendered by account holder
during his temporary visit to India, provided
the amount was declared on a Currency Declaration Form
(CDF), where applicable, and
(ii) the notes are tendered
to the authorised dealer in person by the account holder
himself and the authorised dealer is satisfied that account
holder is a person resident outside India.
other NRE/FCNR Accounts
accruing on the funds held in the account.
on Government securities and dividend on units of mutual
funds, provided the securities/units were purchased by debit
to the account holder's NRE/FCNR account or out of inward
remittance through normal banking channels.
proceeds of Government securities including National
Plan/Savings Certificate as well as proceeds of Government
securities and units of mutual funds sold on a recognised
stock exchange in India and sale proceeds of units received
from mutual funds, provided the securities/units were
originally purchased by debit to the account holder's
NRE/FCNR account or out of remittances received from outside
India in free foreign exchange.
of share/debenture subscriptions to new issues of Indian
companies or portion thereof, if the amount of subscription
was paid from the same account or from other NRE/FCNR
account of the account holder or by remittance from outside
India through normal banking channels.
of application/earnest money made by the house building
agencies on account of non-allotment of flat/plot, together
with interest, if any (net of income-tax payable thereon),
provided the original payment was made out of NRE/FCNR
account of the account holder or remittance from outside
India through normal banking channels and the authorised
dealer is satisfied about the genuineness of the
other credit if covered under general or special permission
granted by Reserve Bank.
to NRE/FCNR accounts of the account holder or any other
person eligible to maintain such account.
in shares/securities/commercial paper of an Indian company
or for purchase of immovable property in India within
other transaction if covered under general or special
permission granted by the Reserve Bank.
of Interest - as per the directives of the Reserve Bank of
Security of Funds held in the Account To
the account holder
i) For personal
purposes or for carrying on business activities (except
agricultural/plantation activities/investment in real estate
ii) For making direct investment in India on
iii) For acquisition of flat/house
in India for his own residential use.
In January 2007, the
RBI imposed a restriction on loans against deposits and
securities for NRIs to a maximum of upto Rs. 20
To third parties
The loan should be utilised for personal purposes or for
carrying on business activities (other than
agricultural/plantation activities/real estate business). The
loan should not be utilized for re-lending.
Authorised dealers may allow their overseas
branches/correspondents to grant fund based and/or non-fund
based facilities to Non Resident depositors against the
security of funds held in the NRE accounts and also agree to
remittance of funds from India if necessary, for liquidation
Resident Status of Account Holder
NRE Accounts should be re designated as resident account or
the funds held in these accounts may be transferred to the
Resident Foreign Currency (RFC) Accounts (if the account
holder is eligible for maintaining RFC Account) at the option
of the account holder immediately upon the return of the
account holder to India (except where the account holder is on
a short visit to India).
of funds to Non Resident Nominee can be permitted by the
authorized dealer or bank in the case of an account holder who
Accounts - in the names of two or more Non Resident
individuals may be opened provided all the account holders
are persons of Indian nationality or origin. When one of the
joint holder become residents, the authorised dealer may
either delete his name or allow the account to continue as
NRE account or redesignate the account as resident account
at the option of the account holders. Opening of these
accounts by a Non Resident jointly with a resident is not
Account may be opened in the name of eligible NRI during his
temporary visit to India.
by Power of Attorney - Resident Power of Attorney holder can
operate on the NRE accounts but only for local payments to
be made on behalf of the account holder. The Power of
Attorney (POA) holder cannot credit proceeds of foreign
currency notes/bank notes and travellers cheques to the NRE
cases where the account holder or a bank designated by him has
been granted permission by Reserve Bank to make investments in
India, the POA holder is permitted to operate the account to
facilitate such investments. POA holders cannot, however, make
gifts from NRE accounts.
Special Series of
Overdrawing - permitted from NRE Savings Bank account up to
Rs. 50,000 for a period not exceeding two weeks.
abroad by Resident nominee - application for meeting the
liabilities if any of the deceased account holder or similar
other purposes, should be forwarded to RBI for
Exemption - Interest income exempted from income tax,
balances held are also exempt from wealth tax.
- Transactions to be reported to the Reserve Bank of India.
South Indian Bank
(SIB), has launched ‘NRE Savings - Diamond
The South Indian Bank (SIB), a leading bank in India, has
launched ‘NRE Savings - Diamond Account’ targeting NRE
customers who maintain high average balance in their saving
bank accounts. This account offers multi-city features to the
With the carefully thought-out value additions of this
pioneering product, the NRIs who maintain an average balance
of nearly QR4500 can enjoy free and unlimited Any Branch
Banking (ABB) facilities, free and unlimited fund transfer to
any other bank account in India through RTGS and NEFT by debit
to NRE accounts.
The privileges also include free and unlimited purchase of
Drafts/Payment Orders by debit to NRE accounts, free
International ATM-cum-Debit Card for which annual maintenance
charges are not collected, free withdrawal of cash through
other Banks' ATMs in India, free fund transfer facility
through Internet Banking, free utility payment and e-commerce
services for Internet Banking customers and free SMS facility
and no annual maintenance charges.
Presiding over the function, Dr V A Joseph, Chairman and CEO
of the Bank, said: “South Indian Bank is striving hard to
render personalized customer service using the latest
technological capabilities.” Source ::: The Peninsula
The FIRST among the private sector banks in Kerala to become a
scheduled bank in 1946 under the RBI Act. The FIRST bank in
the private sector in India to open a Currency Chest on behalf
of the RBI in April 1992.
One of the earliest banks in South India, "South Indian Bank"
came into being during the Swadeshi movement. The
establishment of the bank was the fulfillment of the dreams of
a group of enterprising men who joined together at Thrissur, a
major town (now known as the Cultural Capital of Kerala), in
the erstwhile State of Cochin to provide for the people a
safe, efficient and service oriented repository of savings of
the community on one hand and to free the business community
from the clutches of greedy money lenders on the other by
providing need based credit at reasonable rates of