What is an NRO and NRE Bank Account?

Following are two main types of bank accounts which can be maintained by NRI / PIO in India:

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

   Any person resident outside India (including NRI or foreign national or non-Indian origin visiting India) can open NRO bank account with an authorized bank in India for the transactions in Indian Rupees. NRO Account can be of types including current, savings, recurring or fixed deposit accounts.

   NRI/PIO can remit money (transfer money to their foreign account) from the NRO account as long as they paid taxes in India.

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

   Any Non Resident Indian can open NRE Account. NRE account is usually opened by NRIs with their resident close relatives in India. The resident close relative are eligible to operate the account as a Power of Attorney holder for the limited purpose of withdrawal of local payments or remittances through normal banking channels to the account holder himself. NRE Account can be of types including current, savings, recurring or fixed deposit accounts. NRE account is maintained in Indian Rupees.

Both NRO and NRE accounts can be used to trade in the India Stock Market.

Click here to read the detailed comparison of NRE and NRO Bank Account.