It is a savings or current account held in India that helps NRIs manage income earned in India such as rent, dividends, or pension from abroad.
1 Funds in NRE account is repatriable (That is, funds can be converted to any foreign currency). 2  Interest income earned on the money in a NRE account is non-taxable in India. 3  NRI can have joint account with other NRIs (Resident Indians cannot be joint account holders in NRE accounts). 1 Funds in a NRE account will be maintained in Indian Rupees. 2  Source of funds into NRE accounts must be from your earnings abroad or from another NRE / FCNR-B account maintained in India. 3  Funds can be transferred from an NRE account to an NRO, NRE or Resident account. Foreign currency deposited into the NRO account is converted into Indian Rupees. Any NRI can open a NRO account. NRIs may also convert their existing resident savings account into an NRO account when their status changes from resident to non-resident. Money transferred to an NRE account from any foreign currency is converted to INR. It permits an NRI to hold and maintain foreign currency earnings in INR. The account holder may repatriate all the funds along with the interest earned at any point of time without having to pay tax on the interest amount. Share this on your social network: If a person is a Non Resident Indian (NRI), he can open two kinds of account in India-a non-resident rupee accounts (NRE), and non resident ordinary rupee accounts (NRO). Here's the difference between the two. NRE: In this account rupee denominations can be maintained. NRE Account Meaning: In India banking terminology, the term Non-Resident External or NRE Account refers to funds deposited with a financial institution that allows for the efficient conversion and transfer of Indian and foreign currency both within and outside of India. NRE Account Example: For example, a NRE Account can only be opened in India by an NRI or Non-Resident Indian or by an Indian national who has lived outside of India for a period of no less than 180 days in the previous year. An NRO account is a savings or current account held in India that helps NRIs manage income earned in India such as rent, dividends, or pension from abroad. The account holder can deposit and manage accumulated rupee funds conveniently through an NRO account. Money transferred to an NRE account from any foreign currency is converted to INR. It permits an NRI to hold and maintain foreign currency earnings in INR. The account holder may repatriate all the funds along with the interest earned at any point of time without having to pay tax on the interest amount. The differences between NRE and NRO accounts are outlined below in the following account features. 1  Repatriation: Repatriation is defined as sending or bringing money back to the foreign country. 2  You can easily repatriate funds from an NRE account including the interest earned in that account. Money transferred to an NRE account from any foreign currency is converted to INR. It permits an NRI to hold and maintain foreign currency earnings in INR. The account holder may repatriate all the funds along with the interest earned at any point of time without having to pay tax on the interest amount. A Non-Resident Ordinary (NRO) account is the normal bank account opened by an Indian going abroad with the intention of becoming an NRI. An NRI can also open this account by sending remittances from his home country or by transferring funds from his other NRO account.  A NRE (Non-resident External Accounts) account is a Rupee denominated account. Funds in NRE account is maintained in Indian rupees only. 1 Funds in a NRE account will be maintained in Indian Rupees. 2  Source of funds into NRE accounts must be from your earnings abroad or from another NRE / FCNR-B account maintained in India. 3  Funds can be transferred from an NRE account to an NRO, NRE or Resident account. An NRE account is a savings or current account held in India that allows the account holder to repatriate funds that come from outside earnings and transfer earnings to India conveniently and securely. Money transferred to an NRE account from any foreign currency is converted to INR. It permits an NRI to hold and maintain foreign currency earnings in INR. The account holder may repatriate all the funds along with the interest earned at any point of time without having to pay tax on the interest amount. Primarily there are two reasons for opening such account: NRI wants to repatriate overseas earned money back to India and/or NRI wants to keep India based earnings in India. NRI has the option of opening a Non Resident Rupee (NRE) account and/or a Non Resident Ordinary Rupee (NRO) account. An NRO account can also be opened by a Person of Indian Origin (PIO) and an Overseas citizen of India (OCI). Similarities between NRE and NRO accounts: Both accounts can be opened as Savings as well as current accounts and are Indian Rupee accounts.
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what is nre account