Introduction
Non-Resident External (NRE) accounts are special bank accounts in India for non-resident Indians (NRIs). They allow NRIs to hold and manage foreign earnings in Indian currency, offering repatriation benefits and tax exemptions.
What is an NRE Account?
NRE accounts are special accounts designed for Non-Resident Indians to park their foreign earnings in India and get returns by way of interest on NRE Savings Account. These funds are fully repatriable. The interest earned on the investment is tax-free in India.
Benefits & Features of NRE Savings Account
The following are the benefits and features of an NRE Savings Account
- NRE savings accounts are maintained in Indian Rupees but repatriable in foreign currency.
- The balances in NRE savings accounts are fully repatriable
- NRIs can open joint NRE accounts with other NRIs or with resident Indians, subject to certain conditions.
- Competitive interest offered. Interest on NRE Savings Account is not taxable in India.
- Nomination facilities will be available.
- NRIs can maintain and access their funds in India conveniently.
- Foreign Income by way of earnings from foreign employment, business activities, or investments can be parked in NRE savings accounts.
- Funds in NRE Savings accounts can be invested in fixed deposits, stocks, mutual funds or real estate in India.
Best NRE Savings Account Interest Rate in 2023
The list of the best NRE Savings Account interest rates by top banks in India are given below:
Name of the Bank | Interest Rate |
ICICI Bank | 3% to 3.50% p.a. |
Axis Bank | 3% to 3.50% p.a. |
Yes Bank | 3.50% to 6% p.a. |
SBI | 2.70% to 3% p.a. |
Kotak Mahindra Bank | 3.50% p.a. |
Union Bank | 2.75% to 3.55% p.a. |
HDFC Bank | 3% to 3.50% |
PNB | 2.70% to 3% p.a. |
Canara Bank | 2.90% to 4% |
Why Choose an NRE Savings Account in 2023?
Several reasons compel NRIs to choose an NRE Savings Account
- Ideal for NRIs looking to safely park their foreign earnings in India
- International Debit Card issued will enable easy withdrawal of cash and shopping worldwide
- The interest on NRE Savings Accounts is tax-free in India
- Repatriation of both interest and principal is permitted.
- NRIs can manage and invest their funds in India
- The accounts are regulated by the RBI, ensuring security and transparency
How to Apply for an NRE Savings Account Online?
The steps to apply for NRE Savings Accounts are given below:
- Access the official website of the preferred bank
- Under the NRI Banking option on the dashboard choose ‘NRE Savings Account’
- Complete the account opening form, upload the required documents, and submit
- A representative of the bank will contact you for further requirements.
- Once the application and the documents are verified and approved, the bank will open the NRE account and send the details via email.
How to Apply for an NRE Savings Account Offline?
To open an NRE Savings Account Offline
- Visit the nearest branch of the bank
- Collect the application form.
- Fill in the details accurately.
- Submit the application along with copies of the required documents.
- Upon verification of the application and the documents, the bank will open the account and provide you with the account number.
NRE Savings Account Service Charges in 2023
NRE Savings Account Service Charges of top banks in India are given below
Name of the Bank | AMB/AQB | Non-maintenance of min balance | Cheque Issue Charges | Cheque Return Charges | Account Statement charges |
Axis Bank | Rs. 25000 or Rs. 1.00 lac FD for a minimum of 6 months | Rs. 10 per every Rs. 100 shortfall of required AMB with a minimum of Rs. 100 | Unlimited free cheque books | Inward cheques: Rs. 500 per instance Outward cheques: Rs. 200 per instance | Rs. 100 per instance for duplicate statement |
ICICI Bank | Rs. 10000 to Rs. 25000 | 2% to 6% of shortfall of MAB or Rs. 500 whichever is lower depending on the type of account | Nil for 25 cheque leaves. Courier charges Rs. 375 will be collected | Rs. 500 per instance for inward cheques and Rs. 200 per instance for outward cheques | Rs. 100 per statement |
HDFC Bank | Rs. 2500 to Rs. 10000 depending on the lRs.ocation | 6% of the shortfall or Rs. 600 whichever is lower | 25 cheque leaves free. Additional 25 leaves cheque book at Rs. 100 and Rs. 75 for senior citizens | For inward cheques, Rs. 450 for the first cheque, Rs. 500 for the 2nd cheque and Rs. 550 for the 3rd onwards Rs. 200 per instance for outward cheques | Rs. 100/- per duplicate statement |
Yes Bank | Rs. 10000 | 5% to 10% of the shortfall depending on the percentage of shortfall | Free | Rs. 300 per cheque for inward cheques | Nil |
Kotak Mahindra Bank | Rs 1000 | Rs. 50 + 5% of the shortfall | Rs. 1.50 per cheque leaf | Rs. 350 on the first instance and Rs. 750 per cheque thereafter for inward cheques Rs. 200 per instance for outward cheques | Current year statement: no charges Historical statement: Rs. 100 Physical statement (weekly): Rs. 100 per month Physical statement (daily): Rs. 500 per month |
SBI | Rs. 1000 to rs. 3000 depending on the branch location | Rs. 10 to Rs. 15 depending on the percentage of shortfall and the branch location | 25 cheque leaves free in a year thereafter Rs. 30 for 10 leaves cheque book Rs. 75 for 25 leaves and Rs. 150 for 50 leaves | Rs. 500 per instance for inward cheques | Free passbook Rs. 100 for duplicate passbook Rs. 100 per statement |
Documents Required to Apply for NRE Savings Account
The following are the documents required to open an NRE Savings Account
- An Indian Passport holder has to submit a copy of the valid Passport and VISA or work/residence permit copy
- A foreign passport holder i.e., has to submit a copy of the valid passport along with OCI/PIO card/PIO declaration
- Proof of Address (any of the following)
- Aadhar Card
- Valid Passport
- Driving Licence
- Voter’s ID Card
- Job Card issued by NREGA
- Address Proof for foreign citizens holding PIO/OCI Card
- PIO card
- OCI Card
- Green Card
- Letter issued by Foreign Embassy or Mission in India
- PAN Card
- Passport-size photographs
Difference Between NRE Savings Account & NRO Savings Account
The following are the key differences between an NRE Savings Account and an NRO Savings Account
NRE Savings Account | NRO Savings Account |
Account to park foreign earnings in India | Account to park income out of investments in India like rent, FD interest, dividends, etc. |
Maintained in Indian Rupees | Maintained in Indian Rupees |
Interest on NRE Savings Account is not taxable in India | 30% tax applied on interest earned |
Can repatriate both principal and interest | Interest is repatriable fully. Restrictions on repatriation of principal |
Can be opened jointly with another NRI | Can be opened jointly with an NRI as well as a resident Indian |
Deposit in foreign currency | Deposit in Indian Rupees |
Withdrawal in India Rupees | Withdrawal in Indian Rupees |
Prone to exchange fluctuation risk | Not prone to exchange fluctuation risk |
NRE Account FAQ’s:-
The following can open an NRE Savings Account
Any Indian Citizen who has gone abroad for an unlimited duration for gainful employment, on vocation, or for carrying on business
A person of Indian Origin (PIO) or Overseas Citizen in India (OCI)
Persons of Indian nationality or origin employed by shipping companies/airlines based at Foreign Ports and residing abroad
Students pursuing studies abroad and staying abroad
Indian nationals working with foreign government/foreign agencies, UNO or other international agencies, or on deputation or posted abroad
The initial deposit can be by way of foreign inward remittance, or transfer from other NRE or FCNR accounts.
Yes. You can withdraw cash in NRE Savings Accounts. International debit card will be issued which will enable seamless cash withdrawal through ATMs and shopping worldwide.
Yes. The foreign currency notes or traveller’s cheques brought by NRE account holders during their temporary visit to India can be deposited into their NRE Savings Account.
No. NRIs senior citizens are not eligible for preferential interest rates.