Saving Bank Accounts for NRIs-Difference between NRE & NRO Acs-Required Documents

NRE Savings Account

# NRIs (individuals/entities of Bangladesh/Pakistan nationality/ownership require prior approval of RBI).

# Joint Account facility

Account can be held jointly by a NRI (persons of Indian nationality or origin) / with a Resident Indian (Former or Survivor basis). A Resident Indian can operate the account only as a Mandate / POA holder. The Resident Indian must be a close relative as defined in Section 6 of the Companies act, 1956.

# Currency in which account maintained

Indian Rupees (INR)

# Repatriation

Principal and interest are fully repatriable

# Mandate Holder

An Indian resident can be authorized to operate the account and provided with an ATM card for the account

# Interest Rate

Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

Interest earned is exempted from Tax in India

NRO Savings Account

·         # Any person resident outside India (other than a person resident in Nepal and Bhutan).

·         Individuals/entities of Pakistan Nationality/ownership, entities of Bangladesh ownership and erstwhile Overseas Corporate Bodies require prior approval of Reserve Bank of India.

# Joint Account facility- Account can be held jointly by a NRI (persons of Indian nationality or origin) / with a Resident Indian

·         # Currency in which account maintained

·         Indian Rupees (INR)

# Repatriation

RBI allows repatriation only for i) current income ii) up to USD one million per financial year (April-March), for any bonafide purpose after payment of applicable taxes.

# Mandate Holder

An Indian resident can be authorized to operate the account and provided with an ATM card for the account

# Interest Rate

Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

Interest is taxable under Indian Income Tax Act

RFC Savings Account for Returning NRIs

# A Resident Foreign Currency Savings Account can be opened by NRIs who have returned for permanent settlement after being resident outside India for a continuous period of not less than one year. These funds can be transferred to an NRE/FCNR account upon change of status to NRI again.

# Joint Account facility

Account can be held jointly by eligible Returning NRI with a Resident Indian (Former or Survivor basis). The Resident Indian must be a close relative as defined in Section 6 of the Companies act, 1956.

# Currency in which account maintained

US Dollar (USD), Great Britain Pound (GBP)

# Repatriation

 Funds are repatriable for bonafide purposes

# Mandate Holder

  N.A.

# Interest Rate

 Rate as advised by Bank from time to time as per stipulated guidelines and will be displayed on the website

# Taxation

 Interest earned is exempted from Tax in India provided Resident but Not Ordinarily Resident (RNOR) status is held as per the Income Tax Act

Read Also - List of Indian & Overseas Address proof (for NRE/NRO also)

Required Documents to Open Saving Accounts:-

A) Status Proof

In case you are a Non-Resident Indian (NRI account documents)	If you’re a Person Of Indian Origin (PIO)
Photocopy of the relevant pages of your current passport where your name, address, date of birth, date & place of issue, expiry date, photograph & signature appear	Requirement: The Photocopy of the relevant pages of your current passport (in which your name, address, date of birth, date & place of issue, expiry date, photograph & signature is mentioned)
Also, the photocopy of Valid Visa / IKAMA (only for GCC) / Overseas Citizen of India card Others: The permanent Residency Card issued by USA and Singapore can be accepted in lieu of Visa	Photocopy of the PIO Card (If available) OR One has to fill in the self-declaration for PIO on the form

B) Overseas Address Proof (Anyone)

The documents mentioned below are accepted as an overseas address proof (anyone):

·         Valid Overseas Passport

·         Valid Driving License

·         Any relevant utility bill - Electricity / Telephone / Mobile (original bill) / Piped Gas / Broadband / Water Bill (not more than 3 months old)

·         Credit Card Bill along with photocopy of credit card (not more than 3 months old)

·         1-month bank account statement on bank's stationery (it should not be more than 4 months old) along with at least 1 customer-initiated transaction

·         Depository Participant (DP) account statement on bank's stationery (not more than 3 months old) with at least 1 customer-initiated transaction of at least 1 month

·         Banker's verification on bank's stationery

·         Not more than one-year old: Wealth/ Income/ Sales/ Service Tax Assessment Order

C) Identity Proof (Anyone)

The documents mentioned below are accepted as Identity proof (Anyone):

·         Valid Passport

·         PIO Card i.e. applicable only in case of PIOs

·         Valid Driving License

·         Voter’s ID card

·         Photocopy of Bank statement or passbook of an NRI account with another Scheduled Commercial Bank in India not more than four months old with at least one customer-initiated transaction. (Only if it contains Photograph)

·         Overseas Citizen of India card

·         There should be a valid Photo ID Cards issued by any of the following Organizations/Institutions:

·         Central / State Government Ministries and Departments

·         Statutory / Regulatory authorities (e.g. Insurance Regulatory and Development Authority, National Highway Authority of India, Securities Exchange Board of India, Airports Authority of India, Directorate General Civil Aviation, All India Council of Technical Education, Reserve Bank of India, Indian Banks’ Association, Telecom Regulatory Authority of India, Central and State Electricity Regulatory Commissions, Bar Councils, Institute of Chartered Accountants of India etc.)

·         PSUs established under Central / State Govt.

·         Pension Book /Card / Freedom Fighter’s Pass

·         Senior Citizens Card

·         Ministry / Department of Defense for personnel & their dependents

·         Public Financial Institutions

II) Here are the additional documents required if you have not met any Bank official yet

·         You will need to get photocopies of supporting documents duly attested by Indian Embassy or (High Commission or Bankers verification).

or

·         Self-certify the copies of documents and furnish anyone self-signed additional identity proof

III) Mandate-Holder Documentation

If there is a need to add a Mandate Holder needs to the account then please submit an Identity proof, Address proof and Signature proof (Not required if the current passport has a signature) of the Mandate Holder. The Mandate Holder will need to self-attest the photocopies of all his / her documents submitted as proof of the documents.

If you’re sending the form directly from abroad, you will need to send the Mandate Letter to your appointed Mandate Holder who resides in India.

The appointed Mandate Holder would require submitting the completed form, along with the documents, in person at any of the YES BANK branches in India. The mandate holder will have to carry his / her documents in original for verification purposes.

IV) Seafarers Account

A.    Going on a new fresh contract:

·         You’ll need a photocopy of Passport with Visa (first four pages of the passport as well as the page indicating last date of arrival in India OR Copy of Passport and separate proof of NRI status (in case the Visa / Permit is not included in the passport)

·         Valid Contract Copy

·         Continuous Discharge Certificate (CDC) booklet copy with your name, other details & the latest discharge stamping (optional if contract valid)

·         Mailing address proof required. Overseas address proof not mandatory.

B.    NRI Savings account documents required:
List of additional documents to be provided in case of a Permanent Employee

·         Initial work contract &

·         Last wage slip (within last 6 months)

If you are a Contract Employee, then you also need to provide the last work contract valid as on date.

C.   In case you have just back from a contract & are on a break:

·         In case your last contract letter is no longer valid/ expired within last the 9 months similar would be accepted without need of new contract letter confirmation from local agent (a local agent is an individual /entity which coordinates and helps placement of seafarers in shipping companies), provided CDC is valid (as on date of account opening), as CDC is a sufficient proof of NRI status.

·         If the person doesn’t have a CDC but holds a valid VISA, then last contract letter will be accepted as above, if the passport shows immigration seal within the last 6 months.

·         In case of expiration of the contract letter prior to 9 months, a letter from a local agent that will confirm the next date of joining vessel or current work contract letter will be required.

·         Any declaration by Seafarers (Provided in the Account Opening Form)

D.   Additional Information:

·         There is no need for a CDC copy for crew members employed with cruise liners.

·         As this is a seafarer account the permanent address proof would be mandatory.

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Procedure to Settle a Claims in Deceased Depositors Account.

(1) Settlement of Claims in Single Account with or without Nomination.

(a) SB / CD account with Nomination – The balance amount will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositor.

(b) SB / CD account without Nomination -  The balance amount will be paid to the legal heir(s) (or any one of them as mandated by all of the legal heirs) on verification of the authority of the legal heir(s) and proof of death of depositor.

(c) Term Deposit account with Nomination – The balance amount will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositor on maturity date of deposit.

(d) Term Deposit account without Nomination -  The balance amount will be paid to the legal heir(s) (or any one of them as mandated by all of the legal heirs) on verification of the authority of the legal heir(s) and proof of death of depositor on maturity of deposit.

(e) Premature termination of Term Deposit account with nomination – Premature termination of term deposit account as per terms of contract will be permitted at the request of the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositor.

(f) Premature termination of Term Deposit account without nomination – Premature termination will be permitted on joint request by all legal heirs (or any of them as mandated by all the legal heirs) as per the terms of the contract on verification of the authority of the legal heirs and proof of death of depositor.

(2) Settlement of Claims in Joint Account with or without Nomination and without Survivorship Mandate (operated jointly).

(a) SB / CD account with Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, the balance amount will be paid jointly to survivor(s) and the legal heirs of the deceased joint account holder (or any of them as mandated by all the legal heirs) against their joint claim on verification of the authority of the legal heirs and proof of the death of the depositors.

(ii) In the event of death of both / all joint account holders, the balance amount at the time of death of the depositors will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositors.

(b) SB / CD account without Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, the balance amount will be paid jointly to survivor(s) and the legal heirs of the deceased account holder (or any one of them as mandated by all the legal heirs) against their joint claim on verification of the authority of legal heirs and proof of death of depositor.

(ii) In the event of death of both / all joint account holders, the balance amount will be paid jointly to the legal heir(s) of all the deceased depositors (or any of them as mandated by all the legal heirs) on verification of authority of the legal heirs and proof of death of all the depositors.

(c) Term Deposit Account with Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, the balance amount will be paid jointly to survivor(s) and the legal heirs of the deceased joint account holder (or any of them as mandated by all the legal heirs) on verification of identity of the legal heirs and proof of the death of the depositors on maturity of the deposit.

(ii) In the event of death of both / all joint account holders, the balance amount at the time of death of the depositors will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositors on maturity of the deposit.

(d) Term Deposit Account without Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, the balance amount will be paid jointly to survivor(s) and the legal heirs of the deceased account holder (or any one of them as mandated by all the legal heirs) against their joint claim on verification of the authority of legal heirs and proof of death of depositor on maturity of the deposit.

(ii) In the event of death of both / all joint account holders, the balance amount will be paid jointly to the legal heir(s) of all the deceased depositors (or any of them as mandated by all the legal heirs) on verification of authority of the legal heirs and proof of death of all the depositors on the maturity of the deposit.

(e) Premature Termination of Term Deposit account with Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, premature termination of term deposit will be permitted against joint request of the survivor(s) and the legal heir(s) (or any one of them as mandated by all legal heirs) as per the terms of contract on verification of identity of the legal heirs and proof of death of depositor.

(ii) Premature termination of term deposit account as per the terms of contract will be permitted at the request of the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of depositors.

(f) Premature Termination of Term Deposit account without Nomination.

(i) In the event of death of one (or more but not all) of the joint account holders, premature termination of term deposit will be permitted against joint request by the survivor(s) and the legal heir(s) of all the deceased depositors (or any one of them as mandated by all legal heirs) as per the terms of contract on verification of authority of legal heirs and proof of death of depositor.

(ii) In the event of death of both / all the joint account holders, premature termination of term deposit will be permitted against joint request by all legal heirs of the deceased depositors (or any one of them as mandated by all legal heirs) as per the terms of contract on verification of authority of legal heirs and proof of death of depositors.

(3) Settlement of Claims in Joint Account with mandate “Either or Survivor” / “Former or Survivor” / “Anyone or Survivors” / “Latter or Survivor” with or without nomination.

(a) SB / CD account with Nomination.

(i) In the event of death of one (or more but not all) of the depositors, the balance amount will be paid to survivor(s) on verification of proof of death of the depositor.

(ii) In the event of death of both / all the joint depositors, the balance amount will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of all depositors

(b) SB / CD account without Nomination.

(i) In the event of death of one (or more but not all) of the deposits, the balance amount will be paid to survivor on verification of proof of death of the depositor.

(ii) In the event of death of both / all the joint depositors, the balance amount will be paid jointly to the legal heirs (or any one of them as mandated by all the legal heirs) on verification of authority of legal heirs and proof of death of all depositors.

(c) Term Deposit Account with Nomination.

(i) In the event of death of one (or more but not all) of the depositors, the balance amount will be paid to survivor(s) on verification of proof of death of the depositors on maturity of deposit or as agreed at the time of opening of deposit.

(ii) In the event of death of all joint depositors, the balance amount will be paid to the nominee on verification of nominee’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of all depositors on maturity of deposit or as agreed at the time of opening of deposit.

(d) Term Deposit Account without Nomination.

(i) In the event of death of one of the depositors (or more, but not all), the balance amount will be paid to the survivors on verification of proof of death of the depositor on maturity of deposit or as agreed at the time of opening of deposit.

(ii) In the event of death of all joint depositors, the balance outstanding will be paid to the legal heir(s) of all the deceased depositors (or any one of them as mandated by all the legal heirs of joint holders) on verification of authority of legal heirs and proof of death of all depositors on maturity of deposit.

(e) Premature termination of Term Deposit Account.

(i) In the event of the death of one (or more but not all) of the depositor(s), the balance amount will be paid to the survivor(s) after premature termination of term deposit account on verification of proof of death of the depositor(s), only if, there is a joint mandate from all the depositors to this effect given either at the time of placing the fixed deposit or subsequently during the tenure of deposit or there is suitable clause in this regard in deposit account opening form which is accepted and signed by all the depositors at the time of opening of fixed deposit account.

(ii) In the event of the death of one (or more but not all) of the depositor(s), the balance amount will be paid jointly to survivor(s) and the legal heir(s) of the deceased joint account holders (or any of them as mandated by all the legal heirs) against their joint claim on verification of authority of the legal heir(s) and proof of death of depositor(s). If there is no joint mandate from all the depositor(s) / suitable clause in account opening form to this effect as stated in above para ((3) (e) (i)).

(iii) With Nomination – In the event of death of all the joint depositors, the nominee will have right to seek premature termination of term deposit account as per the terms of the contract on verification of claimant’s identity (such as PAN Card, Election ID Card, Aadhaar Card, MANREGA Card, Passport, Driving License etc) and proof of death of all depositors.

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Suggestions given by AIBEA to the Finance Minister

The rate of interest on savings bank deposits needs to be revised upwards by at least 2 per cent and interest on fixed deposits should be exempted from the purview of income tax, according to suggestions made by the All India Bank Employees’ Association(AIBEA) to the Finance Minister.

The association said banks should extend agriculture loan at the rate of 2 per cent per annum. Further, they should extend education loan at concessional rate of interest of 5 per cent to the poorer sections, with interest subvention.

Since non-performing assets of the banks have risen phenomenally, the Government should institute more Debt Recovery Tribunals and Fast Track Courts to recover the bad loans.

“The Reserve Bank of India should publish the list of defaulters, who owe the banks more than Rs. 1 crore. This defaulters list should be published every six months with updates.

“Section 45 of the RBI Act should be suitably amended to provide powers to RBI to publish the name of any defaulter in public interest,” said CH Venkatachalam, General Secretary, AIBEA.

Venkatachalam emphasised that bank loan defaulters should be prohibited from contesting in any of the elections to local body or Legislative Assembly or Parliament or to hold any public office of profit. Any such person, who holds such position at present should be made to relinquish their positions, he added.

The association alleged that the Insolvency and Bankruptcy Code (IBC) is facilitating the corporate defaulters to get away easily as the banks are forced to bear enormous “write-off” of bad loans in the name of “hair-cuts”.

“IBC favours resolution of bad loans instead of recovery. Hence, recovery mechanism should be strengthened instead of resolution process. To facilitate recovery, recovery laws should be enacted/amended to confiscate the personal assets of the Directors in case of default by a company, in which they are directors,” the Association said.

The AIBEA said banks should be advised to institute a separate vertical, headed by a General Manager, for recovery in “Prudentially Written Off/ Technically Written Off” accounts. The details of such recovery should be placed before the boards of the Banks and submitted to the Ministry of Finance on a quarterly basis.

“A system must be evolved to ensure accountability and responsibility on the part of the Managing Directors & CEOs/Executive Directors and other executives of the public sector banks in respect of sanction of credit, which which tun into NPA within one year (quick mortality cases),” said Venkatachalam.

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How much did your bank collect charges on non-maintenance of minimum balance?

If you do not maintain a minimum balance in your regular savings bank account, chances are your bank penalises you for non-maintenance of the average monthly balance.

In 2017-18, public sector banks and leading private sector banks together collected close to Rs. 5,000 crore (Rs. 4,989.55 crore) from customers who did not maintain minimum balance in their accounts, according to the numbers presented by the government in Lok Sabha last month in response to a question on charges levied by banks on customers.

The Reserve Bank of India (RBI) allows banks to fix reasonable charges on services provided. However, there are a set of accounts that cannot be charged with a penalty for non-maintenance of minimum balance. The Jan Dhan Yojana accounts and basic savings bank deposit accounts, also called no-frills accounts, are exempt from minimum balance requirements. Many banks also exempt salary accounts from maintaining a minimum balance.

How is average monthly balance calculated?

Different banks have different minimum balance requirements and penalties. Let’s take the example of State Bank of India, the largest bank in the country. In metro cities, the minimum balance you need to maintain in your SBI account is Rs. 3,000; it is Rs. 2,000 in semi-urban branches; and Rs. 1,000 in rural branches. The amount of penalty is decided on the amount that falls short of the minimum balance requirement for the particular category of account.

Average minimum balance is calculated by taking into account the balance maintained in an account on all the days of the month. Let’s take an account in a metro city in a 31-day month in SBI. If it had Rs. 5,000 for 10 days, Rs. 3,000 for 10 days, and Rs. 2,000 for 11 days; the average monthly balance would be: [(5,000x10)+(3,000x10)+(2,000x11)]/31 = Rs. 3,290. So, no penalty would be imposed in this case.

If the balance in the last 11 days was Rs. 1,000, the average minimum balance would have been Rs. 2,935 and Rs. 10 (plus taxes) would be charged for that month, as the shortfall was less than 50% of the balance requirement. If the shortfall is between 50% and 75% of the average minimum balance needed, the charge would be Rs. 12 and if the shortfall is over 75%, it is Rs. 15.

The charges are between Rs. 7.5 and Rs. 15 for semi-urban branches and Rs. 5-10 for rural branches. SBI had brought back this requirement for its savings accounts in April 2017, after a gap of six years.

Many banks, including SBI and ICICI Bank also let you check your average monthly balance through their Netbanking interface.

Source- Livemint

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United Bank Tops the List of Jan Dhan Accounts with Deposits of over Rs1 Lakh,see other banks stats

The blatant misuse of bank accounts opened under Pradhan Mantri Jan Dhan Yojana (Jan Dhan) now stands exposed through the Right to Information (RTI) Act application filed by Moneylife. This information is sadly restricted to public sector banks (PSBs). So far, United Bank of India (UBI) has disclosed a whopping 1.18 million accounts with a deposit of over Rs1 lakh in Jan Dhan accounts. There is a clear rule that such accounts cannot have a balance of more than Rs50,000 at any point of time, since the accounts were meant to bring the unbanked into the banking fold and help direct transfer of subsidies to beneficiaries.

Instead, it is clear that very weak know-your- customer (KYC) requirements seem to have turned these accounts into money-mules during the demonetisation process to launder unaccounted currency. 

These accounts could be opened with a simple Aadhaar card, a job card under the NREGA scheme or just a letter issued by a Gazetted officer, with a duly attested photograph of the person. There seems to have been a rampant abuse of this leniency. The scheme also said that the accounts could remain valid only for 12 months by which time full KYC needed to be done. 

It is not clear if the government has done anything in this regard. However, a report in the Business Standard on Wednesday says that 60% of Jan Dhan deposits after the note ban are under investigation. Since it will soon be two years since the government put the economy into a shock by announcing demonetisation, this is, indeed, a slow investigation. 

Our RTI filings show that Union Bank of India had 323,000 Jan Dhan accounts with deposits of over Rs1 lakh, followed by Oriental Bank of Commerce with 282,000 accounts. Number of such accounts in other PSBs range between 198 (Indian Bank) to Bank of Baroda at 79,240 Jan Dhan account that have deposits of over Rs1 lakh. This is among those who have responded to the RTI query.

In terms of highest number of Jan Dhan accounts with deposits between Rs10,000 to Rs99,000, Bank of Baroda tops the list with 1.28 million accounts. It is followed by United Bank of India at 1.01 million Jan Dhan accounts. Except Andhra Bank at 65,121, all other banks, who provided the information under the RTI Act, have 117,000(Indian Bank) to 906,000 (Bank of India) accounts with a deposit between Rs10,000 and Rs99,999.

As part of a fact-finding exercise, Moneylife had filed RTI application with the department of financial services, under the Ministry of Finance, seeking information on PMJDY scheme relating to PSBs. The CPIO of the department forwarded our RTI application to all PSBs, asking them to respond us directly. Here are the questions we had asked in the RTI...

• What is the maximum amount deposited till date by any account-holder/beneficiary?
• The number of accounts having deposit between INR10,000 to INR99,000.
• The number of accounts having deposit exceeding INR100,000.
• The number of accounts, which are dormant since past two years.

As per latest data shared by PMJDY website, United Bank of India has second highest deposits in Jan Dhan accounts. United Bank has deposits of Rs8,012.02 crore from 126 million Jan Dhan account beneficiaries. State Bank of India (SBI) tops the list of total number of account beneficiaries (105.1 million) and amount deposited (Rs18,971.76 crore) in Jan Dhan accounts. Considering its size and network, for SBI these figures are not out of proportion. For United Bank, however, the number of beneficiaries and total amount deposited under Jan Dhan accounts looks completely out of proportion.

Source- Moneylife

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