For non-resident Indians (NRIs) living and working in the US, managing finances back home can be challenging. From recurring expenses to investments and savings, transferring money conveniently to India is essential. This is where NRE (Non-Resident External) and FCNR (Foreign Currency Non-Resident) bank accounts can help.
Offering simplified cross-border transactions and attractive returns, these specialised accounts allow NRIs to fund needs in India seamlessly.
This article explores everything you need to know, from their key features to the process for transfers from the US.
NRE Account Basics
An NRE account enables NRIs to park overseas earnings in India while benefitting from valuable perks. This account with an Indian bank allows foreign income earned abroad to be deposited. NRE accounts are designed so NRIs can seamlesslysend money from US to India. Key advantages include:
Key Features and Benefits
Some valuable advantages include:
- Tax-free interest earned on deposits held in accounts
- Flexibility to fully repatriate the principal and interest abroad
- Competitive interest rates for consistent growth in savings
Sending Money Using an NRE Account
You can seamlessly transfer money from your US bank account to the NRE account online.
Online Transfer Process
The process involves straightforward steps. You initiate the transfer from your US bank’s portal to the account and routing number of the Indian bank where you hold the NRE account.
The money is converted to Indian Rupees (INR) at prevailing forex rates.
Limits and Conditions
There is no cap on deposit amounts, so any transfer amount can be accommodated.
Estimated Transfer Times
Transfers via SWIFT take 2-3 working days to process with clearing on the Indian side.
Fees
Banks levy minimal fees and forex charges for facilitation.
FCNR Account Basics
An FCNR account allows NRIs to deposit and save overseas earnings in foreign currency instead of converting to INR.
Key Features and Benefits
Useful advantages include:
- Tax-free interest on deposits
- Hedge against currency exchange risks
- Option to pick from various foreign currencies
Interest Rates/Returns
Banks offer competitive returns on FCNR deposits aligned to global rates for chosen currencies and tenure from 1 to 5 years.
Currency Options
FCNR supports top global currencies, including USD, EUR, GBP, AUD, SGD and more.
Sending Money Using an FCNR Account
You can seamlessly transfer money from the US to your FCNR account in India.
Process of Transferring Online
Remitting money involves a few easy steps with your US bank initiating transfers via SWIFT.
Applicable Limits
There are no limits on deposit amounts allowed.
Timelines
Money gets credited to FCNR accounts within 1-2 working days.
Exchange Rate Benefits
A key advantage is that funds are held in foreign currency instead of converted to INR. This shields your money from exchange rate fluctuations.
Fees for Transfers
Banks like IDFC FIRST Bank facilitate cost-effective transfers with nominal charges to global accounts.
Conclusion
NRE and FCNR accounts simplify payments and money management for NRIs by allowing direct INR and foreign currency deposits, respectively, in Indian accounts. With beneficial features like tax savings, high returns, and hedge against currency risks, online transfers through these accounts offer the best way to fund needs back in India.
