5 Ways in Which an NRO Account Can Help NRIs

A large number of Indians working in foreign countries also have income sources in India. This can be in the form of rent from their property, dividends from investment, or pension from senior citizen plans. In order to manage their earnings from India, most NRIs prefer opening an NRO (Non-Resident Ordinary) account.

To better meet the banking needs of such NRIs, some of the top banks in India now offer a host of benefits on their NRO accounts. Five of the top benefits are as follows-

1. Easy Management of Indian Earnings

As per FEMA (Foreign Exchange Management Act), any Indian with an NRI status is not allowed to open and operate a regular savings account in India. If you are an NRI with income sources in India, this can make the management of your earnings from India very challenging.

With an NRO account, you can efficiently manage all your Indian earnings just like a savings bank account. From transferring funds to your family members to even paying bills in India, NRO accounts make everything possible for an NRI.

2. Interest on Balance Maintained in NRO Account

One of the biggest advantages of opening an NRO account is the interest you earn on the maintained balance. The interest rate on the NRO account of some banks can be as high as 3.50% to 4% per annum.

While the interest earned from the NRO account is subject to TDS, NRIs can take advantage of the DTAA (Double Tax Avoidance Agreement) to earn higher post-tax yield.

3. Easy Fund Transfers to Foreign Countries

With an NRO account, NRIs can easily transfer their earnings from India to any foreign country of their choice. The interest earned from an NRO account in a financial year is fully repatriable after applicable tax deduction while the principal amount can be repatriated as per the set limits of up to USD 1 million per year.

Some of the top banks in India now offer highly competitive exchange rates on transfers made from India to a foreign country. Even the transfer fee is minimum and highly affordable.

4. Online Banking Facility

As mentioned above, using an NRO bank account is similar to using a regular savings account. You will get a user ID and online banking password for logging into the online banking portal of your bank. The account can be accessed at any time of the day or night for enhanced convenience.

You can then transfer funds to the bank account of your family members, pay utility bills, pay premiums of insurance policy, invest, and do much more in India even though you are located in a foreign country.

5. Mandate Benefits

Most of the banks offering NRO account facility also allow you to have a mandate holder for your account. The mandate holder will also have an ATM card and cheque book with the help of which he/she can easily use the account on your behalf.

You can select your spouse, parents, or any other member of your family as the mandate holder. Moreover, you can now open NRO account online and also select the mandate holder at the time of filling the online application form.

NRO Account for Easy Management of INR Earnings

The benefits you can avail by opening an NRO account depend largely on the Indian bank you select for your account.

So, make sure that you compare things like the interest rate, NRI banking facilities, exchange rate, balance requirement, and reputation of the bank to make the right decision and experience maximum benefits.

Disclaimer: "The contents of this article is meant merely for informational purpose. Any reliance placed on such information is therefore strictly at one’s own risk."

A banking expert, with all the banking solution