Most Indians living overseas tend to have familial obligations back home in India. While they may not be present physically, they ensure that they are present financially. They usually do this with the help of an NRI savings account. Such a savings account can not only be used to send funds to family members back home in India but can also be the foundation of financial investments in India.
In fact, NRIs who invest in real estate in India use an NRI savings account to regularly pay home loan instalments. But before applying for an NRI savings account, you need to be fully aware of the documents needed in the application process.
Types of NRI savings accounts
The documents required for NRI account opening online may differ from account to account. Primarily, there are two types of NRI savings accounts that an NRI can open in India. These are the non-resident external (NRE) account or the non-resident ordinary (NRO) account.
- An NRE account is generally used by NRIs to build a savings corpus directly from their income in a foreign currency. These accounts are also tax-free interest generators and offer full repatriation benefits.
- On the other hand, the NRO account is used by NRIs to hold income earned from India (such as rental, stock dividends, etc.). This type of account can also form the base for an NRI demat account.
Although there are some minor variations in the documents required for NRE and NRO accounts, the overall necessities remain the same.
Basic identity documents
For NRI account opening online, you will require a small collection of basic identity documents, including but not limited to a valid passport (copies of the first, last, and address pages). You will also need several recent passport-sized photos.
These are the minimum documents that any reputable Indian banknormally needs from NRIs who wish to either open an NRE or NRO account. Others have fully digitised the process of opening the account.
Proof of NRI status
The next step is to submit documents that prove your NRI status. These are compulsory as per the guidelines of the Foreign Exchange Management Act, 1999 (FEMA). A valid resident visa or work permit is usually accepted as proof of NRI status. On the other hand, some banks may also need additional documents, such as a residence permit or any long-term stay document.
Whether you are opening an NRI demat account or a savings account, you should note that a tourist visa is not an acceptable document to show proof of NRI status.
Overseas address proof
Besides these, the NRI account opening online process also require you to provide address proof to show that you live overseas. Although most reputable banks are known for their hassle-free account opening, these documents are considered a necessity.
The documents that can serve as overseas address proof include utility bills like electricity, gas, or water bills, an overseas bank statement, or even a driving license from the country you reside in. Do note that these address proofs should be from the last 3 months to be considered valid.
PAN card and other requirements
Another requirement that NRIs need to qualify for NRI account opening online is to have a Permanent Account Number (PAN) card. While it may not be a necessity overseas, a PAN card is mandatory for any financial activity in India.
The primary purpose of banks to ask you to provide your PAN card is to report taxes and to associate all your investments in India with your PAN card. This is useful to guarantee adherence and to prevent fraudulent practices.
Final thoughts
The process of opening an NRI savings account is planned and introduced with the purpose of securing regulatory compliance and financial safety. Although documentation can be seen to be very thorough, it is an important factor in safeguarding the bank as well as the customer.
