Savings AccountSavings Account
Term DepositsTerm Deposits
Credit CardsCredit Cards
NRI AccountNRI Account
LoansLoans
Preferred BankingPreferred Banking
chat Chat

NRE, NRO, and FCNR Accounts: Which NRI Account Should You Choose?

RBL Bank Jun 10, 2025

Non-Resident Indians (NRIs) often have very different banking and investment needs than those who live in India. This is because a majority of their earnings and assets are usually in international currencies. As a result, NRIs might need an account that can hold and convert their overseas earnings into Indian rupees. There are many NRI account options to choose from depending on their financial goals and needs. RBL Bank like most major banks and financial institutions in India, offers NRI accounts with great amenities.

If you’re an NRI looking to open a bank account in India, you have several options available to you. This article covers the three main types of NRI accounts - NRE, NRO, and FCNR (B) - as well as their benefits and drawbacks. For instance, an FCNR account allows you to maintain a fixed deposit in foreign currencies, providing guaranteed returns and protection against currency fluctuations. Additionally, these accounts offer tax exemptions in India. Read on to learn more about each account type and make the best choice for your needs.

Individuals who meet any of the following criteria can open NRI Bank Accounts in India.

  • NRIs, PIOs (Persons of Indian Origin), and OCIs (Overseas Citizens of India).
  • Indian citizens settled abroad for employment, studies, business purpose and other legitimate purposes.
  • Spouse of an NRI accompanying him/her on dependent visa or spouse of a PIO/OCI.
  • Indian Citizens working on international vessels, merchant navy, cruise lines and oil rigs.
  • Individuals officially deputed abroad by the Government of India or PSUs.
  • Individuals who held an Indian passport at any point in time.
  • Individuals whose parents or their grandparents were Citizens of India as per the India Citizen Act 1955.

Three Major Types of NRI Accounts in India

  • Non-Resident External (NRE) Savings Account & Fixed Deposits - meant to deposit or save foreign earnings in Indian currency.
  • Non-Resident Ordinary (NRO) Savings Account & Fixed Deposits - used to manage and save income earned in India and are held in Indian currency.
  • Foreign Currency Non-Resident (FCNR) (B) Deposits - used to deposit or save foreign currency earnings in any of the currencies that the RBI has approved.

Let’s get more into the specifics of each of these:

Understanding NRO Account

If you have income in India, a Non-Resident Ordinary (NRO) account is a valuable savings account. You can transfer your income earned in India including dividends, equity returns, pensions, rental income, and any other form of revenue. One may deposit funds in either Indian or foreign currencies into this account. However, only Indian rupees are used for withdrawals. NRO accounts can also be leveraged to invest in Indian securities, shares, mutual funds, etc. This rupee account comes in savings, current, fixed, and recurring deposit account variations.

Key Features:

  • Manage your money earned in India from a variety of sources using the NRO account.
  • Foreign currency deposited in the NRO account is converted to Indian rupees at the applicable exchange rate.
  • You can also repatriate up to $1 million from it each fiscal year.

Understanding NRE Account

NRIs can deposit their foreign income in Indian rupees into this bank account. This account, which is denominated in rupees, can be used as a savings account, current account, fixed deposit account. NRE account can be held by an individual or jointly with an NRI. Only income derived from abroad is eligible for NRE deposits. This account cannot accept deposits of earnings made in India.

Key Features:

  • The account permits the transfer of foreign currency to India, allowing you to keep INR in your Indian bank account. The money you deposit in this account is fully repatriable.
  • The interest earned on the NRE Savings and Fixed Deposits is tax free.

Understanding Foreign Currency Non-Resident Account (FCNR)

An FCNR (B) account is a term deposit account and should not be confused with a savings account. NRIs may deposit funds into this term deposit in any of the currencies that the RBI accepts. Currently, RBL Bank accepts deposits in eight different currencies: USD, GBP, AUD, SGD, CAD, CHF, EUR, and JPY.

The FCNR (B) deposit allows NRIs to save their foreign earnings through fixed deposit accounts in India. While making an FCNR account, money can be transferred from an NRE account. The currency and tenure affect the interest rate on FCNR (B) accounts. NRIs can earn a fixed rate of interest on this account until maturity.

Key Features:

  • As a holder of an FCNR account, you can maintain your deposits in different currencies through an FCNR (B) deposit, which is ideal for NRIs managing their foreign earnings.
  • The terms of these deposits can range from one year to five years.
  • The amount you deposit, and the interest earned are fully repatriable.
  • The FCNR account allows automatic renewal of deposits at maturity.
  • The FCNR deposits you maintain are not subject to Indian taxation.

Eligibility and Requirements

To open an FCNR (B) Fixed Deposit account, you must meet the following eligibility criteria:

  • You must be a Non-Resident Indian (NRI).
  • You must have a valid passport and visa.
  • You must have a valid NRE or NRO account with the bank.
  • You must meet the minimum deposit requirements.

Opening an FCNR (B) Fixed Deposit account is a straightforward process, and the bank will guide you through the necessary steps. Ensure you have all the required documents and meet the eligibility criteria to take advantage of this beneficial investment option.

A Tabular Comparison

Choose the account that best fits your needs from the three available options. They all provide simple, effective ways for you to manage your income from various sources and allow you to move money between India and your resident country. The parameters of distinction between NRO, NRE, and FCNR accounts are shown in the table below.

PARAMETERS NRE ACCOUNT NRO ACCOUNT FCNR (B) Deposits
Who can open it? NRIs/PIOs/OCIs* NRIs/PIOs/OCIs NRIs/PIOs/OCIs
Deposit Foreign Currency Indian Currency Foreign Currency (USD, GBP, AUD, SGD, CAD, CHF, EUR, JPY)
Withdrawals Indian Rupee Indian Rupee Foreign Currency
Taxation in India Interest earned is tax free Interest income is taxable Not taxable in India
Repatriability Deposits and the interest earned are fully repatriable Limited repatriability upto 1 million USD per financial year The deposits and the interest earned on them are fully repatriable
Joint Account Can be held jointly with NRIs Can be held jointly with NRIs Can be held jointly with NRIs
Account Types Savings Account, Current Account, Term Deposits, Recurring deposit Savings Account, Current Account, Term Deposits, Recurring deposit Term Deposits
Loan Against FD Can avail an overdraft in Indian Rupees Can avail an overdraft in Indian Rupees Can avail an overdraft in Indian Rupees against FCNR (B)

A Person of Indian Origin (PIO) is a person residing outside India (except Nepal or Bhutan) who is a citizen of any country other than Bangladesh or Pakistan or such other country as may be specified by the central government.

*individuals/entities of Bangladesh/ Pakistan nationality/ownership require prior approval of RBI.

How can NRIs invest in Indian Secondary Markets

Portfolio Investment Scheme (PIS) Account:

Portfolio Investment Scheme (PIS) Account allows NRIs to invest in shares/convertible debentures of Indian companies under repatriation through a registered stock broker on a recognised stock exchange in India.

The investor will have to open an NRE account (Repatriation basis) account under PIS with only one designated Bank.

As per RBI guidelines, NRIs should have a separate bank account exclusively for PIS purposes and all transactions relating to shares purchased or sold should be routed through this account and it should not be allowed to carry any other transaction which is not related to trading of shares.

RBL Bank NRI Offerings

You can open various NRI accounts with RBL Bank, including NRO accounts, NRE accounts, and FCNR accounts. Manage your foreign and domestic income profitably by opening the account type that best suits your requirements. Click here to learn more about RBL Bank's most recent interest rates, fees, and advantages for opening different types of NRI accounts. Access all the paperwork and forms required for FCNR deposits.

Disclaimer:
Articles published on the website are merely indicative and suggestive in nature and do not amount to solicitation. The contents do not guarantee the desired returns and/or results. Reader is advised to exercise discretion and consult independent advisors for achieving desired result.

Tags

Reward-Points
Zero-Balance-Savings-Account
Digital-Savings-Account
CIBIL-Score
Credit-Score

Newsletter from RBL Bank

Stay informed with the most impactful business and financial news, along with expert analysis from our team.

Archives:

Home

Home
Login

Login
Payments

Payments
RBL Cares

RBL Cares
More

More
go-to-top

TOP