Who Can Open an NRO Account in India?

A Non-Resident Ordinary (NRO) account allows individuals with income sources in India to manage rupee-denominated earnings while residing overseas. This account handles various forms of Indian income, such as rent from property, dividends, pensions, and proceeds from asset sales. It helps non-residents maintain financial ties with India and manage local expenses.

Eligibility for NRO Accounts

Opening an NRO account is for individuals classified as non-residents under India’s foreign exchange regulations. A Non-Resident Indian (NRI) is generally defined by the Foreign Exchange Management Act (FEMA) as an Indian citizen residing outside India for more than 182 days during the preceding financial year. This classification also extends to those who have demonstrated an intent to reside outside India for an uncertain period, such as for employment or higher education.

Persons of Indian Origin (PIOs) and Overseas Citizens of India (OCIs) are also eligible to open NRO accounts. A PIO is typically a citizen of any country other than Pakistan or Bangladesh who held an Indian passport, or whose parents or grandparents were Indian citizens. OCIs are foreign nationals of Indian origin, excluding those from Pakistan and Bangladesh, who meet specific criteria related to their or their ancestors’ Indian citizenship.

It is important to note that resident Indians are generally not permitted to open new NRO accounts. If an individual’s residency status changes from resident to non-resident, existing resident savings or current accounts must be converted into an NRO account to comply with FEMA regulations. NRO accounts can be held individually or jointly with another eligible non-resident or with a resident Indian on a “former or survivor” basis.

Documents Required for Opening

Applicants typically need to provide a valid passport as primary proof of identity and citizenship. Along with the passport, a copy of a valid visa, work permit, or residence permit is often required to substantiate the non-resident status.

Proof of both Indian and foreign addresses is also a standard requirement. This can usually be satisfied with documents such as recent utility bills, bank statements from the country of residence, or a valid residence permit. For individuals classified as PIO or OCI, specific cards like the PIO card or OCI card are typically needed as additional proof of their Indian origin.

A Permanent Account Number (PAN) card, issued by the Indian Income Tax Department, is generally mandatory for opening an NRO account and for most financial transactions in India. If an applicant does not possess a PAN card, Form 60 may be accepted by some banks, though a PAN is usually essential for purposes such as repatriating funds. Additionally, recent passport-sized photographs are universally required for the application.

Steps to Open an NRO Account

Many banks offer the convenience of applying through online portals, allowing applicants to fill out forms and upload documents digitally from their current country of residence. Alternatively, individuals may choose to visit a bank branch in India in person, where they can submit their application and original documents for verification.

Some Indian banks also have overseas branches or representative offices where non-residents can submit their account opening applications. For those unable to visit a physical location, applications and attested copies of documents can often be mailed to the bank’s designated NRI service center in India. After the application and documents are submitted, the bank conducts a thorough verification process.

Upon successful verification, the account is activated. An initial deposit may be required to fund the NRO account and complete the opening process. Banks typically provide guidance and support to ensure compliance with all regulatory requirements.