When to Open NRE Account?

By Anupama Deshpande | July 19, 2021

An NRE Account (Non-Resident External Account) is a bank account in any bank in India which allows an NRI to transfer his foreign income to India in a secured and convenient manner. Moreover, he is allowed to easily repatriate the funds held in his NRE account along with the interest earned thereon at any point of time.

Such accounts can be opened online as well and then as an NRE account holder, you can freely deposit your foreign earnings in your NRE account from your country of residence.

Types of NRE Account

NRE accounts can be of any of the following types. You may open NRE account of any of the below mentioned types as per your choice and requirements:

  • NRE Savings Account
  • Current Account
  • Term Deposit Account
  • Recurring Deposit Account
  • Special Term Deposit Account

When to Open NRE Account?

In following circumstances, NRE account will be the perfect fit:

 1  |  Make Payments in India out of Foreign Earnings

When you need an account for making INR payments such as utility bills e.g. electricity bill, phone bill, broadband bill, gas bill, etc. of your family or making investments in India such as buying hosing property or equity shares, etc. from your overseas earnings.

 2  |  Liquidity Measures

When you want to maintain your savings in INR but keep them in liquid form so that you will be free to use such funds at any point of time according to your needs or choice.

 3  |  Joint Account with NRI

When you wish to open an account jointly with another NRI as the NRE account can be opened with an NRI joint holder.

 4  |  Fully Repatriation of Funds Needed

When you want your INR savings to be fully and freely repatriable without any kind of restrictions. Money deposited in your NRE account can easily be converted back to the original foreign currency as per the prevailing exchange rate and you can repatriate the funds easily.

 5  |  No Tax Liability in India

When you want a tax free income in India on the money earned overseas. There will not be any tax liability for the interest earned on an NRE account. There will be no TDS on interest earned at all in case of an NRE account.

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About Anupama Deshpande
Anupama is a Co-Founder of CodeForBanks.com. She is an MBA (Finance) and Chartered Financial Analyst (CFA). She also carries a Fellowship degree in Life Insurance Sector and is a Master of Computer Application (MCA). She is an expert in Finance Field with an experience of over 18 years on different managerial positions in finance industry including Stock Market, Depository and Mutual Fund Sectors. Apart from that she has remained for few years in the field of marketing as well. Her suggestions and advice for investments have been very useful to many people.
Her vast interest & expertise in the field of finance have encouraged her to write the articles so that others can also get benefitted out of them. She never loses any opportunity to learn and be creative. She is a valuable asset for CodeForBanks.com & important resource to all those around her.