Faq

In terms of the Foreign Exchange Management Act (FEMA), 1999 a person resident outside India means a person who is not resident in India

NRI for this purpose is defined in Regulation 2 of Notification No.FEMA 5 / 2000- RB dated May 3, 2000. In terms of this Notification, an NRI means a person resident outside India who is a citizen of India or is a person of Indian origin.

A person who has gone out of India or who stays outside India for more than 182 days during the course of the preceedingFinancial year, in either case-

a. for or on taking up employment outside India, or
b. for carrying on outside India a business or vocation outside India, or
c. for any other purpose, in such circumstances as would indicate his intention to stay outside India for an uncertain period;

PIO for this purpose is defined in Regulation 2 of FEMA Notification ibid as a citizen of any country other than Bangladesh or Pakistan, if

(a) he at any time held Indian passport; or

(b) he or either of his parents or any of his grandparents was a citizen of India by virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955); or

(c) the person is a spouse of an Indian citizen or a person referred to in sub-clause (a) or (b).

If a person is NRI or PIO, she/ he can, without the permission from the Reserve Bank, open, hold and maintain the different types of accounts given below with an Authorised Dealer in India, i.e. a bank authorised to deal in foreign exchange.

a. Non-Resident Ordinary Rupee Account (NRO Account)

b. Non-Resident (External) Rupee Account (NRE Account)

NRO accounts may be opened / maintained in the form of current, savings, recurring or fixed deposit accounts.

Savings Account - Normally maintained for crediting legitimate dues /earnings / income such as dividends, interest etc. Banks are free to determine the interest rates.

Term Deposits - Banks are free to determine the interest rates. Interest rates offered by banks on NRO deposits cannot be higher than those offered by them on comparable domestic rupee deposits.

Account should be denominated in Indian Rupees.

Permissible credits to NRO account are transfers from rupee accounts of non-resident banks, remittances received in permitted currency from outside India through normal banking channels, permitted currency tendered by account holder during his temporary visit to India, legitimate dues in India of the account holder like current income like rent, dividend, pension, interest, etc., sale proceeds of assets including immovable property acquired out of rupee/ foreign currency funds or by way of legacy/ inheritance.

Eligible debits such as all local payments in rupees including payments for investments as specified by the Reserve Bank and remittance outside India of current income like rent, dividend, pension, interest, etc., net of applicable taxes, of the account holder.

NRI/PIO may remit from the balances held in NRO account an amount not exceeding USD one million per financial year, subject to payment of applicable taxes.

The limit of USD 1 million per financial year includes sale proceeds of immovable properties held by NRIs/ PIOs.

Other than current income and the limit of USD 1 Mn per financial year applicable to NRIs/PIOs, balances in NRO accounts cannot be repatriated without the prior approval of RBI.

The accounts may be held jointly with residents and / or with non-resident Indian.

The NRO account holder may opt for nomination facility.

NRO (current/savings) account can also be opened by a foreign national of non-Indian origin visiting India, with funds remitted from outside India through banking channel or by sale of foreign exchange brought by him to India. The details of this facility are given in the FAQs on “Accounts opened by Foreign Nationals and Foreign Tourists” available on the RBI website.

Loans to non-resident account holders and to third parties may be granted in Rupees by Authorized Dealer / bank against the security of fixed deposits subject to certain terms and conditions

For more details on NRO, you can click on below link

http://www.kotak.com/nri-banking/savings-account/nro-rupee-savings.html#product_faqs

NRE account may be in the form of savings, current, recurring or fixed deposit accounts (with maturity of minimum one year). Such accounts can be opened only by the NRI (as defined under Regulation 2(vi) of Notification No. FEMA 5/2000-RB dated May 3, 2000) himself and not through the holder of the power of attorney.

NRIs may be permitted to open NRE account with their resident close relatives (relative as defined in Section 6 of the Companies Act, 1956) on ‘former or survivor ‘basis. The resident close relative shall be eligible to operate the account as a Power of Attorney holder in accordance with the extant instructions during the life time of the NRI/PIO account holder.

Account will be maintained in Indian Rupees.

Balances held in the NRE account are freely repatriable.

Accrued interest income and balances held in NRE accounts are exempt from Income tax and Wealth tax, respectively.

Authorised dealers/authorised banks may at their discretion/commercial judgement allow for a period of not more than two weeks, overdrawings in NRE savings bank accounts, up to a limit of Rs.50,000 subject to the condition that such overdrawings together with the interest payable thereon are cleared/repaid within a period of two weeks, out of inward remittances through normal banking channels or by transfer of funds from other NRE/FCNR accounts.

Savings - Banks are free to determine the interest rates.

Term deposits – Banks are free to determine the interest rates of term deposits of maturity of one year and above. Interest rates offered by banks on NRE deposits cannot be higher than those offered by them on comparable domestic rupee deposits.

Permissible credits to NRE account are inward remittance to India in permitted currency, proceeds of account payee cheques, demand drafts / bankers' cheques, issued against encashment of foreign currency, where the instruments issued to the NRE account holder are supported by encashment certificate issued by AD Category-I / Category-II, transfers from other NRE / FCNR accounts, sale proceeds of FDI investments, interest accruing on the funds held in such accounts, interest on Government securities/dividends on units of mutual funds purchased by debit to the NRE/FCNR(B) account of the holder, certain types of refunds, etc.

Eligible debits are local disbursements, transfer to other NRE / FCNR accounts of person eligible to open such accounts, remittance outside India, investments in shares / securities/commercial paper of an Indian company, etc.

Loans can be extended against security of funds held in NRE Account either to the depositors or third parties without any ceiling subject to usual margin requirements

Such accounts can be operated through power of attorney in favour of residents for the limited purpose of withdrawal of local payments or remittances through normal banking channels to the account holder himself.

For more details on NRE, you can click on below link

http://www.kotak.com/nri-banking/accounts/savings-account/nre-rupee-savingshtml#product_faqs

As per current guidelines, the principal amount as well as interest earned on NRE Account is exempted from Income Tax in India.

Yes, you can open NRE savings account jointly with Non Resident Indians / Person of Indian Origin.

Funding into your NRE savings account can be done by following ways:-

  • a. Online funds transfer through Click2Remit
  • b. Wire Transfer: Transfer money through overseas banks wire transfer service to fund your Kotak Mahindra Bank NRE account.
  • c. Exchange House: Remit money from GCC countries, Singapore and Hong Kong and get the credit on the same day with minimal costs.
  • d. Foreign currency Cheque: Simply deposit a foreign currency demand draft or chequefavouring your name at any of our branches and the bank will clear the same through an overseas bank and credit it to your respective account.
  • e. Foreign Currency cash deposit: If you are on visit in India, deposit foreign currency cash (in all major currencies) at select Kotak Mahindra Bank branches in India and start using your account thereafter.

  • Note:

    Currency Declaration Form is required:

    - FCY Cash deposit in excess of USD 5000/- or equivalent.

    - FCY Cash together with TravellersCheques in excess of USD 10,000/- or equivalent per person.

    The CDF should be endorsed for the amount surrendered.

    Foreign Currency Cash or TravellersCheques can be credited in to your NRE account only if you visit the branch in person.

  • f. Transfers from other NRE/FCNR accounts in India: Transfer funds from the your existing NRE/FCNR bank account with other banks in India by drawing a cheque in favour of Kotak Mahindra Bank account or transfer funds online from other banks account and start enjoying Kotak Mahindra Bank's exclusive facilities.

The rate of interest payable on your NRE savings bank account is 4.0% p.a. (with effect from 1st April, 2011).

The rate of interest on your savings account is calculated on the daily closing balance maintained and payable on half yearly intervals on the last day of September and March respectively.

You will get a personalized cheque book and International Debit Card on opening NRE savings account.

Yes, a joint holder can have a separate debit card in NRE savings accounts, if the same has been applied.

The limit for Cash withdrawal and POS on Global debit card issued on NRE savings account is Rs. 25,000/- and Rs. 1,00,000/- respectively

Yes, Global debit card issued to account holders in NRE savings account can be used in India as well as abroad for cash withdrawal at VISA ATM and POS at Merchant establishment.

You can access your NRE savings account through Global Debit Card, Net Banking and Phone Banking.

Yes, you can avail nomination facilities in your NRE account. A nominee can either be resident or non-resident as desired by the account holder.

Yes, you can add a mandate holder in your savings account.

RBI allows repatriation of balances held in NRO savings account up to one million USD or equivalent per financial year for bonafide purposes (For e.g. education, medical expenses, employment etc.) with documentation. However, Indian income earned in the current FY (like rent, dividend, interest) can be repatriable as per the above criteria provided there is no tax liability arising out of this income.

Average quarterly balance is the sum of daily closing balance of all the calendar days in a quarter divided by the number of days in that quarter.

As per current guidelines, the principal amount in NRO savings account is exempt from taxes in India. However, the interest earned will be subject to a tax of 30% (plus applicable surcharge and cess). However, on availing DTAA facility, the TDS rate applicable would be in range of 10-25% as per the country of residence based on the prevailing DTAA agreement from time to time.

Yes, you can open NRO savings account with Non Resident Indians / Person of Indian Origins / Resident Indian as a joint holder.

Funding into your NRO savings account can be done by following ways:-

  • a. Online funds transfer through Click2Remit
  • b. Wire Transfer: Transfer money through overseas banks wire transfer service to fund your Kotak Mahindra Bank NRO account.
  • c. Exchange House: Remit money from GCC countries, Singapore and Hong Kong and get the credit on the same day with minimal of costs.
  • d. Foreign currency Cheque:Simply deposit a foreign currency demand draft or chequefavouring your name at any of our branches and the bank will clear the same through an overseas bank and credit it to your respective account.
  • e. Foreign Currency cash deposit: If you are on visit in India, deposit foreign currency cash (in all major currencies) at select Kotak Mahindra Bank branches in India and start using your account thereafter.

  • Note:

    Currency Declaration Form is required:

    - For FCY Cash deposit in excess of USD 5000/- or equivalent.
    - For FCY Cash together with TravellersCheques in excess of USD 10,000/- or equivalent per person.
    - The CDF should be endorsed for the amount surrendered.
    - Foreign Currency Cash or TravellersCheques can be credited in to your NRO account only if you visit the branch in person.

    Transfers from other NRE/NRO/FCNR accounts in India: Transfer funds from your existing NRE/NRO/FCNR bank account with other banks in India by drawing a cheque in favour of Kotak Mahindra Bank account or transfer funds online from other banks account and start enjoying Kotak Mahindra Bank's exclusive facilities.

    Rs. cash deposit / transfer from third party resident accounts in India.

Yes, you can transfer / issue cheques from your NRO savings account to your NRE account with 15CA/CB and declaration as per bank format.

Yes, you can transfer / issue cheques from your NRO savings account to resident account.

Yes, the transfers of funds between NRO savings accounts are allowed.

The rate of interest on your NRO savings bank account is 4.0 % p.a. (with effect from 1st April, 2011).

The rate of interest on your savings account is calculated on the daily closing balance maintained and payable on half yearly intervals on last day of September and March respectively.

You will get a personalized cheque book and Access India Debit Card on opening NRO savings account.

Yes, a joint holder in NRO savings account will be issued a separate debit card, if the same has been applied.

The limit for Cash withdrawal and POS on access India card issued on NRO savings account is Rs. 75,000/- and Rs. 1,00,000/- respectively.

The Access India Card issued on your NRO savings account is for India usage only.

You can access your NRO savings account through Net Banking and Phone Banking.

Yes, you can add a mandate holder in your savings account.

Yes, you can avail nomination facilities in you NRO savings account. A nominee can either be resident or non-resident as desired by the account holder.

Non Resident External Term Deposit is a tax free and fully repatriable Indian Rupee deposit account opened by NRIs / PIOs to earn safe and secured return from the income earned through foreign sources. You can click on below link to know about NRE Term Deposits

http://www.kotak.com/nri-banking/term-deposits/nre-term-deposits.html

An Indian Rupee deposit opened by NRIs / PIOs to earn safe and secured return from the income earned either through Indian or foreign sources. You can click on below link to know about NRO Term Deposits

http://www.kotak.com/nri-banking/term-deposits/nro-term-deposit.html

You can Invest in Foreign currency deposit in 8 currencies (USD, EURO, GBP, YEN, CAD, AUD, CHF and SGD)from income earned from foreign sources to earn safe and secured return by protecting currency from exchange rate risk.To know more, you can click on below link

http://www.kotak.com/nri-banking/term-deposits/fcnr-deposits.html#product_faqs