NRI Tax StatusNRE, NRO and FCNR(B) accounts
The RBI Master Direction on Deposits and Accounts (updated as on 2 September 2026, read on 14 November 2026) sets out the three accounts an NRI uses in India. This page compares them and nothing more: interest rates and tenors are set elsewhere and are not covered.
Side by side
| Point | NRE | NRO | FCNR(B) |
|---|---|---|---|
| Who may open it | NRIs and PIOs | Any person resident outside India | NRIs and PIOs |
| Currency | Indian rupees | Indian rupees | Any permissible foreign currency |
| Forms of account | Savings, current, recurring or fixed deposit | Savings, current, recurring or fixed deposit | Fixed deposit only |
| Money in | Inward remittances, interest, current income with tax dealt with, transfer from NRE or FCNR(B), NRO transfer within USD 1 million | Inward remittances, legitimate dues in India, transfers from other NRO accounts, rupee gifts or loans from a resident relative within the LRS | As for NRE |
| Money out | Local payments, transfer to other NRE or FCNR(B), investments in India; remittance outside India permitted | Local payments, other NRO accounts, current income abroad; other repatriation up to USD 1 million a financial year (NRIs and PIOs) | As for NRE |
| Joint holders | NRIs/PIOs, or an NRI/PIO with a resident relative on former-or-survivor basis (resident only as power of attorney holder while the NRI lives) | Residents on former-or-survivor basis, or other NRIs/PIOs | As for NRE |
The USD 1 million rule
Paragraph 6.8: apart from local payments, transfers to other NRO accounts and remittance of current income abroad, balances in an NRO account cannot be repatriated except by NRIs and PIOs up to USD 1 million, under the Remittance of Assets Regulations, 2016. RBI’s circular of 28 April 2016 describes it as USD one million per financial year out of NRO balances, sale proceeds of assets and assets acquired by inheritance or legacy, on documentary evidence. Money moved to an NRE account counts within that limit.
Who is an NRI or PIO
An NRI is a person resident outside India who is a citizen of India (paragraph 2.4). A PIO is a person resident outside India who is a citizen of another country (not Bangladesh or Pakistan) and who was an Indian citizen or belonged to territory that became part of India, or is a descendant or the foreign-origin spouse of such a person; OCI cardholders are included (paragraph 2.5). This is the exchange control meaning of resident outside India, not the income-tax meaning: for tax see the residential status checker.
Limits of this page
Interest, tenors, tax on interest, bank forms and certificates (15CA/15CB) and anything changed after 2 September 2026 are not covered.
Common questions
What is the difference between an NRE and an NRO account?
An NRE account holds money brought in from abroad and can be sent back outside India; the NRO account is for rupee dealings in India, and its balance cannot be sent abroad except current income and up to USD 1 million a financial year for NRIs and PIOs.
Can I send NRO money abroad?
Paragraph 6.8: the account can be debited for local payments, transfers to other NRO accounts or remittance of current income abroad. Apart from these, NRIs and PIOs may repatriate up to USD 1 million, subject to the Remittance of Assets Regulations, 2016; funds can be moved to NRE within that USD 1 million facility.
What can be paid into an NRE account?
Inward remittances, interest on the account, transfers from other NRE or FCNR(B) accounts, current income such as rent, dividend, pension and interest if the bank is satisfied that tax has been deducted, paid or provided for, and transfers from an NRO account within the USD 1 million limit.
What happens to the account if I return to India?
Paragraph 6.10: an NRO account may be re-designated as a resident account on return to India to stay for an uncertain period. The Master Direction also provides for converting NRE and FCNR(B) balances into a resident foreign currency account when residential status changes (paragraphs 3.2 and 4).
Does this say what interest I will get?
No. For NRE and FCNR(B) accounts the Master Direction leaves rates and tenors to the Department of Banking Regulation rules, which were not read for this page.
Sources
- Reserve Bank of India, Master Direction - Deposits and Accounts (FED Master Direction No. 14/2015-16, updated as on 2 September 2026), paragraphs 2.4, 2.5, 4, 5 and 6, read on 14 November 2026 at rbi.org.in.
- RBI circular A.P. (DIR Series) No. 64/2015-16 of 28 April 2016 on the Foreign Exchange Management (Remittance of Assets) Regulations, 2016.
Read on 14 November 2026 from the RBI Master Direction as updated on 2 September 2026. Interest rates, tenors and tax on interest are not covered. This site is independent, not connected with the RBI or any bank, and gives information, not financial or legal advice.