What is an NRO account? Check benefits, features, and how to open in SBI, ICICI and HDFC Bank

Non-Resident Indians (NRIs) can open a Non-Resident Ordinary (NRO) account to manage income earned in India from sources such as rent, dividends, and pensions.

This article explains the features and benefits of the NRO account, as well as the process for opening it at major banks such as the State Bank of India (SBI), HDFC Bank, and ICICI Bank.

Please note that NRI accounts are specialised bank accounts designed for people residing outside of India. There are three types of bank accounts available for NRIs in India: Non-Resident External Account (NRE), Non-Resident Ordinary Account (NRO), and Foreign Currency Non-Resident Account (FCNR). This article focuses only on the NRO account.

NRO account

NRO account can be opened by NRIs to manage the income they earn in India. An NRO account can be opened by Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs), and Overseas Citizens of India (OCIs).

The income must be held in the deposit account in INR denominations. If funds are transferred from overseas in foreign currency, they are converted into INR before being credited to the NRO account.

Eligibility

An NRO account can be opened by:

• NRIs: If they reside out of India for employment, business or any other purpose, indicating an indefinite stay abroad; or if they have stayed in India for less than 182 days in a financial year, as per the Foreign Exchange Management Act (FEMA).

• Lived in India for 182 days or more in FY 2024-25.

• Lived in India for 60 days or more in FY 2024-25 and lived for 365 days or more during the four years immediately preceding FY 2024-25.

• PIO: A person who is not a citizen of India but has held an Indian passport at any time, has an Indian parent or grandparent, or is the spouse of an Indian citizen or person of Indian origin (PIO).

• A registered Overseas Citizen of India (OCI) under the Citizenship Act, 1955.

Features of NRO accounts

Required documents

The documents required for an NRO account are as follows:

• Application form
• Photocopies of the passport, including details such as name, address, birth date, date of passport issuance and expiration, etc.
• Employment proof
• Work permit/Student Visa/Visa permit/Employment
• Visa/Residence Visa KYC documents (if any)

Major Indian banks like HDFC, ICICI and SBI offer various benefits with full digital onboarding, allowing NRIs and PIOs to manage their finances easily.

Benefits of NRO accounts

• NRO accounts help NRIs to receive and manage income earned in India conveniently.
• NRO accounts allow repatriation (transferring money abroad) up to $1 million per financial year (with necessary documentation and tax compliance). This gives NRIs flexibility.
• These accounts can be held jointly with a resident Indian, which makes it easier for NRIs to operate their accounts.
• NRO accounts also help NRIs make local payments and investments in India. With an NRO account, NRIs can pay utility bills, EMIs, insurance premiums, and taxes in India, and can also invest in Indian mutual funds, stocks, and other instruments.
• The savings and fixed deposits in NRO accounts earn interest. However, the interest is taxable.
• When an Indian resident becomes an NRI, their resident savings account must be converted to an NRO account, simplifying compliance.

How to apply for an NRO account?

How to apply:

• Visit hdfcbank.com and go to NRI Banking.
• Click on ‘How to Open NRI Account?’ and select ‘click here’ in the Non-Face to Face Basis section.
• Fill the NR Account Application Form, and an HDFC Bank representative will call you to assist further with the account opening process.
• You can also visit your nearest HDFC Bank branch to open an NRO account on a face-to-face basis.

How to Apply:

• Visit icicibank.com and go to NRI Banking.
• Click on NRO Savings Account and select ‘open account’.
• Fill out the application and upload KYC documents.
• Choose between video KYC or physical document submission.
• The account will be activated after verification.

How to Apply:

• Visit onlinesbi.sbi and go to NRI Services.
• Go to accounts and select ‘NRO account’ from the drop-down.
• Click on Apply Now and fill out the online application.
• Upload KYC documents or submit them via the embassy/foreign office.
• The account will be activated upon document verification.