An Indian citizen or a foreign citizen of Indian origin who has stayed abroad for employment/carrying out business or vocation for 182 days or more or under circumstances indicating an intention for an unknown duration of stay abroad is a Non-Resident Indian (NRI). Those who stay abroad on business visits, for medical treatment, study or such other purposes, which do not indicate an intention to stay there for an indefinite period, are not considered as NRIs.
Foreign Institutional Investor (FII)?
FII means an institution established or incorporated outside India , which proposes to make investments in Indian securities and is registered with SEBI.
Can an NRI maintain a bank account in India?
Yes. NRIs can maintain bank accounts in rupees as well as in foreign currency. However, accounts in foreign currencies can be maintained with authorized dealers/ banks only.
NRE: Non-Resident (External) Rupee Account
NRO: Non-Resident (Ordinary) Rupee Account
FCNR- B: Foreign Currency (Non -Resident)
What are NRE and NRO accounts?
Non-Resident (External) Rupee (NRE) account is a rupee account from which funds are freely repatriable. It can be opened with either funds remitted from abroad or local funds maintained in NRE/ FCNR accounts, which can be remitted abroad. The deposits can be used for all legitimate purposes. The balance in the account is freely repatriable. Interest credited to the NRE accounts is exempt from tax in the hands of the NRI.
Non-Resident Ordinary Rupee (NRO) account is a rupee account and can be opened with funds either remitted from abroad or generated in India. The amounts in such an account are generally non-repatriable. However, funds in NRO accounts can be remitted abroad subject to/as per various directives in force at the time of repatriation. More details can be found on the Reserve Bank of India (RBI) website www.rbi.org.in
Can NRIs & FIIs invest in mutual funds in India?
Yes. NRIs (except from USA and Canada) and FIIs can invest in mutual funds in India.
