What is an NRO Account
An account which is opened under the Non-Resident Ordinary Rupee Account Scheme in India is called as NRO Account.
It can be opened by anyone who is not resident in India. Hence, foreign nationals can also open an NRO Account. It can open by individuals as well as entities. Individuals and entities based in Pakistan and Bangladesh would require prior approval of the Reserve Bank of India for opening an NRO account.
It can be opened in Indian currency only. It can be in the nature of a savings account, current account, recurring account or a fixed deposit account.
An Indian resident can hold a NRO account jointly with a non-resident only on ‘former or survivor’ basis.
What are the transactions which can be undertaken through NRO account
An indicative list of the transactions which can be undertaken through NRO account are as under:
- Inward remittances from outside India
- Legitimate dues in India
- Payments made in India for local expenses
- Remittance of current income abroad
- Settlement of charges on international credit cards.
Apart from the current income received, the balances are not repatriable outside India.
Can a tourist in India open an NRO account
A tourist who is a foreign national can open an NRO account with funds remitted from outside India through normal banking channels or by sale of foreign exchange brought by him to India. The balances in the account can be paid to the tourist at the time of his departure from India. This payment can be made only if the account is maintained for less than 6 months and the account has not been credited with local funds.
The above article provides a general overview on the topic. For further information with respect to NRO accounts, kindly contact services@jneela.com.
