How to Open an NRE Account from Abroad

Many NRIs with bank accounts and earnings in India can face problems in keeping track of their finances. Transferring and repatriating funds between countries can pose a challenge. To reduce this problem for the NRI, many banks provide online NRI services and allow them to open an NRE account from abroad. 

NRE is the Non-Resident External account that allows non-resident Indians to deposit their foreign earnings into an Indian bank account in Indian rupees. It helps the NRI to manage their income earned abroad. Let’s discuss how to open an NRE account online. 

 Understanding the NRE Account

An NRE Account is a special kind of bank account that helps NRIs to deposit their foreign earnings into an Indian bank in INR. When you open NRE account online, you can enjoy several benefits, like full repatriability, tax-free interest, etc. 

You should understand the differences between the NRE, NRO, and FCNR(B) accounts to make the right choice. 

• NRE account: It holds the income earned abroad, and both the interest and principal are fully repatriable. The interest earned on this account is tax-free and suitable for NRIs to save foreign earnings.

• NRO account: Used to manage income earned in India; interest is taxable, and repatriation is restricted

• FCNR(B) Account: It is a fixed deposit account where funds are maintained in foreign currency, and protects your income against exchange rate fluctuations.  The funds are locked in for a tenure range from 1 to 5 years, on the basis of the deposit term chosen.

Types of NRE Accounts

The NRE account is of three different types

• Savings account: It is suitable for day-to-day transactions 

• Fixed deposit account: It is suitable for earning higher interest rates over a tenure 

• Recurring deposit account: It is suitable for NRI who wants to deposit fixed amounts regularly 

Eligibility and Account Types

The eligibility criteria to open an NRE account from abroad are given below.

Documents Required to Open an NRE Account 

Opening an NRE account from abroad usually requires the following documents. 

• Valid passport 

• Visa or residence permit 

• Overseas Address proof (Utility bills, rental agreements, or bank statements)

• Indian address proof like Aadhaar card, utility bills, or property documents (optional depending on bank)

• Income proof (optional)

• 2-3 copies of Passport-sized photographs

• PAN card

How to Open an International Bank Account? 

It is simple to open an NRE account from abroad. The step-by-step procedure you should follow is:

1. Select bank: Choose the Indian banks that are offering the NRE account from abroad, like SBI, HDFC, ICICI, Axis Bank, and others.

2. Gather documents: Gather your documents required to open an NRI account, like a Valid Passport, a Valid Visa or Residency Proof, Overseas Address Proof, and a PAN Card (recommended)

3. Apply online or in branch: Many banks allow candidates to apply for the NRE account online. If you don’t want to apply online, then you can visit the overseas branch.

4. KYC Verification: Now, submit the required documents and complete the Know Your Customer (KYC) verification process. Your account will be activated within 7-10 working days.

Deposits, Withdrawals & Repatriation Rules 

The money deposited in foreign currency in an NRE account is converted automatically to Indian rupees ( INR) by the bank as per currency conversion rates. There is no upper limit applicable to the account balance maintained in this account. 

Withdrawals are made in INR through debit card, ATM, or online transfer. Moreover, the funds from this account are freely repatriable. It means the non-resident Indians can easily transfer the funds to their overseas account without limits.

The income earned in an NRE account is exempt from income tax. If your physical cash deposits or withdrawals in one or more accounts are up to 2 million or more, then it is important to have a PAN card. If you don't hold a PAN Card, then you should start the process of applying for one.  

Practical Tips for Digital NRI Banking 

Opening an NRI account online makes fund transfer easier, safer, and faster. Here are the tips to follow about digital NRI banking: 

• Select banks that have AI-powered onboarding and secure mobile apps meant for global usage. 

• Compare transfer fees, exchange rates, and customer support before settling down with any of the banks. 

• Store a digital copy of your visa, passport, address proofs, and other documents. 

• Track the RBI notifications with respect to cross-border compliance and remittances 

• Use multi-currency remittance platforms, which are compatible with the NRE account and use rapid fund transfers.

Conclusion

Opening an NRE account from abroad is an efficient and practical way for NRIs to manage their finances. Its benefits include the tax-free returns and hassle-free repatriation offered to NRIs. By applying for this account with the right bank, you can achieve your financial goals and get the most out of the NRE account. 

Ready to get started with your NRE account online? Download Rupeeflo and open your account digitally today!

FAQs

1. Can I open a joint NRE account?

Yes, you can open a joint NRE account with another NRI/PIO holder or a close resident relative.

2. Which is better, an NRO or an NRE account?

Both NRO and NRE accounts are beneficial and meet your different goals. For example, if you want to maintain the overseas earnings in India in INR currency, then you should open an NRE account. If you want to save and manage funds earned in India, then you can open an NRO account. 

3. Can I withdraw the cash from the NRE account from abroad?

No, you can’t withdraw the cash from an NRE account from abroad. You can only withdraw cash from this account in India by using an account-linked debit card.

4. What are the benefits of an NRE account for investments in India?

The NRE account provides you with tax-free interest, easy online management, full repatriability, and a convenient way to invest in India from abroad.