Rupee Accounts of Non-residents Other Than Banks

7/27/2019 Rupee Accounts of Non-residents Other Than Banks

1/32

ForeWordVolume 1 Volume 2 Volume 3 Volume 4 Volume 5 Volume 6

CHAPTER 2

Foreign Exchange Operations

RUPEE ACCOUNTS OF NON-RESIDENTS OTHER THAN BANKS

SECTION A

Residential Status:

In terms of Section 2 (v) of FEMA 1999 "a Person resident in India means"

a person residing in India for more than one hundred and eighty two days during the

course of the preceding financial year but does not include-

(A)a person who has gone out of India or who stays outside India, in either case-

a)for taking up employment outside India, or

b)for carrying on a business or vocation outside India, or other purpose, in such

circumstances as would indicate his intention to stay outside India for an uncertain

period;

(B)a person who has come to or stay in India, in either case, otherwise than-

a.for or on taking up employment in India, or

b.for carrying on a business or vocation in India, or

c.for any other purpose, in such circumstances as would indicate his intention to stay

in India for an uncertain period;

i.any person or body corporate registered or incorporated in India

ii.an office, branch or agency in India owned or controlled by a person resident

outside India

iii.an office, branch or agency outside India owned or controlled by a person resident

in India

DEFINITION OF NRI

In terms of Section 2 (w) of FEMA " Person resident outside India" means a person

who is not resident in India. Person includes an individual, a Hindu undivided family, a

company, a firm, an association of persons or a body of individuals whether

incorporated or not.
http://172.16.0.5/BOI2011/Foreword_ScanCopy/ForewordLetter.pdfhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%201)/Vol%201%20MainLink_Page.htmlhttp://172.16.0.5/BOI2011/After_convert_Html%20(Vol%202)/Vol%202%20_MainPage.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/Volume%203%20Index%20Page.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%204)/Vol%204%20MainLink_Page.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%205)/volume%205(IOB%20Part).htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%206)/Vol%206.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%201)/Vol%201%20MainLink_Page.htmlhttp://172.16.0.5/BOI2011/After_convert_Html%20(Vol%202)/Vol%202%20_MainPage.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/Volume%203%20Index%20Page.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%204)/Vol%204%20MainLink_Page.htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%205)/volume%205(IOB%20Part).htmlhttp://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%206)/Vol%206.htmlhttp://172.16.0.5/BOI2011/Foreword_ScanCopy/ForewordLetter.pdf


2/32

1.An Indian Citizen who stays abroad for employment/carrying on business or vocation

outside India or stays abroad under circumstances indicating an intention for an

uncertain duration of stay abroad is a non-resident. Persons going abroad for studies

are treated as Non-Resident Indians (NRIs) and are eligible for all the facilities availableto NRIs. Educational and other loans availed of by them as residents in India will

continue to be available as per FEMA regulations.

1.1.Persons posted in U.N.Organisations and officials deputed abroad by

Central/State Government and Public Sector undertakings on temporary assignments

are also treated as non-residents.

1.2.Non-resident foreign citizens of Indian Origin are treated on par with non-

resident Indian for opening and maintaining accounts and for making investment.

Person of Indian Origin means a citizen of any country other than Bangladesh or

Pakistan, if

a)he at any time held Indian passport;

or

b)he or either of his parents or any of his grandparents was a citizen of India by

virtue of the Constitution of India or the Citizenship Act, 1955 (57 of 1955);

or

c)the person is a spouse of an Indian citizen or a person referred to in sub-clause ( a )

or (b);

1.3.Overseas Corporate Bodies (OCBs) have been derecognized as an eligible class

of investor under various routes/schemes available under extant Foreign Exchange

Management Regulations.

1.4.In case of doubts/clarifications regarding the NRI status of individuals

approaching branches to open accounts, branches should take up with D & A Section,

Foreign Exchange Department, Central Office. Further, FAQ on various entitlements of

NRI/PIO published in the website of the Reserve Bank is also made available in thehome page of our TREASURY (FOREIGN) and branches may refer to the same.

ACCOUNTS OF CERTAIN NON-RESIDENTS TREATED AS RESIDENT ACCOUNTS:

2.Although the under noted categories of persons, firms, companies, etc., are treated

as resident outside India under FEMA, their rupee accounts with ADs in India are


3/32

regarded as resident accounts and hence branches may open such accounts and allow

free operation of accounts, provided the requirements under FEMA 1999 are complied

with.

(i)Indians, Nepalese or Bhutanese resident in Nepal or Bhutan.

(ii)Offices and branches situated in Nepal or Bhutan of any business carried on by a

company or a Corporation incorporated or established under any Law in force in India,

Nepal or Bhutan.

(iii)Offices and branches in Nepal or Bhutan of any business carried on as a

partnership firm or otherwise by Indians, Nepalese or Bhutanese.

3.For opening accounts in the names of Pakistani and Bangladesh nationals, branches

should obtain prior approval of Reserve Bank of India and the approval details should

be recorded in the relative account opening forms and Ledger/Register folios/ system

records.

4.All the Indian branches of our Bank can open and maintain the following categories

of Rupee Accounts in the names of Non-Resident Indians (NRIs) and Person of Indian

Origin.

i)Ordinary Non-Resident Rupee Accounts (NRO Accounts)

ii)Non-Resident (External) Rupee Accounts (NRE Accounts)

A comparative chart containing the salient features and conditions governing

credit/debit transactions of the above four types of accounts are furnished as

Annexure-I. Before opening accounts under these schemes, branches should ensure

that the applicants satisfy the criteria laid down for the residential status under FEMA

1999.

5.Branches should be guided by instructions contained in the following while opening

and allowing operations in non-resident rupee accounts:

i)Foreign Exchange Management (Deposit) Regulations, 2000 issued under FEMA

1999 and Notification No. FEMA 5 /2000-RB dated 3rd May 2000 .

ii) Master circulars and AP (DIR) Circulars issued by Reserve Bank of India

iii) Circulars issued by Central Office.
http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#annex1http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#annex1http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#annex1


4/32

(Regulations governing maintenance of and operations on non-resident rupee accounts

by authorised Co-operative/Commercial banks have been given separately by Reserve

Bank of India in Memorandum ABM).

6.OPENING OF ACCOUNTS IN THE NAMES OF NRIs:

6.1.Any Non-Resident of Indian Origin or Nationality who desires to open account

with the branch, may send the prescribed application duly completed and signed -

verified by his/her Bank/Indian Embassy/Notary Public/our Banks Account holder along

with remittance to the branch.

6.2.Alternatively, photocopies of passport giving passport number, signature,

photographs and date of issue/expiry date of passport may be sent by the prospective

account holder.

6.3.Branches are permitted to open NRE accounts for Indians before proceeding

abroad with zero balance in the account after verifying Passport, Visa and Air ticket for

the journey and give them the Account Number.

6.4.Branches opening rupee accounts in the names of minors, joint accounts should

ensure observance of the usual precautions for opening of accounts, issue of pass

book/statement of accounts, issue and despatch of cheque books, operation of

accounts, standing instructions, etc. In this connection, attention of branches is invited

to Chapter 1 (on Constituents Accounts - General) of Volume I of Book of Instructions.

6.5.Branches should choose the correct type of non-resident account in the CBS

package, for different categories of non-resident accounts opened/maintained by

them.

6.6.Details such as names of NRIs, their nationality, Indian contact address,

overseas address, passport particulars, name and address of the introducer/identifying

overseas bank/branch, operational/payment instructions like E or S, F or S, A or S,nominations etc., should be recorded in the account master in CBS packages

authenticated properly by the authorised official.

6.7Branch should send the deposit receipt through registered post to the NRI

depositor at the address given in the application/account opening form. The deposit


5/32

receipt should not be handed over to agents/middlemen/third parties. The branch

should ensure that complete postal address of the NRI depositor has been furnished in

the account opening form and should exercise special care, if the address is

incomplete or only post box number has been furnished.

6.8.The Account opening forms, specimen signature cards, should be properly filed,

preserved and produced for verification by our Internal Inspectors/Reserve Bank of

India Inspectors/External Auditors when required.

6.9.In terms of Policy Document on KYC-AML, Nonresident customers are placed

under RIP Three (high risk) category in the Risk Perception Matrix. Hence branches

should apply due diligence with the available information provided by the customer

and the estimation arrived on the additional information gathered through interaction

with the customer. Suitable STTL (Single Transaction Threshold Limit)may be

fixed as applicable to the risk level.

REMITTANCES:

7.1.Branches handling inward remittances received for opening/credit to non-

resident accounts and outward remittances made to the debit of non-resident accounts

should ensure that the remittances received/made are in conformity with the

permitted methods prescribed under FEMA 1999.

7.2.Branches should ensure that each inward remittance is promptly acknowledged

to the NRI and relative credit is made to the account without delay, observing

procedural guidelines for handling inward remittances. Similarly, the requests for

foreign outward remittances should be promptly attended to by branches.

7.3. NAD branches opening/maintaining accounts should note to handle purchase

transactions under prior report to the designated AD branch. For sale of foreign

exchange on account of NRI customers, the NAD branch should take up with the

designated AD branch, which will arrange for release of exchange in the form of draft,

mail transfer, telegraphic transfer, foreign currency TCs/Notes, etc. In this connection,branches are advised to ensure compliance of procedural aspects contained in

relevant chapters of this volume.

7.4. While handling foreign currency notes/coins on account of NRIs, branches

should be guided by the general instructions regarding purchase/encashment of


6/32

foreign currency notes contained in Chapter on Foreign Travels of the volume.

7.5.The purchase/sale transactions (in foreign exchange) in opening/maintaining

non-resident accounts in the names of NRIs by both AD branches and NAD branchesshall be reported to TREASURY (FOREIGN) only by AD branches, in accordance with the

procedure laid down for such reporting. (Refer Chapter 1 of this volume).

7.6. Branches should properly record and promptly execute the various

standing/special instructions of NRIs for local disbursements under advice to account

holders. While executing the instructions of the customers, branches should ensure

that debits/credits made to these accounts are permitted debits/credits under FEMA

1999.

LOANS AND OVERDRAFTS

8.1.1.Branches granting loans/overdrafts to NRIs against the security of NRO/NRE

deposits should ensure compliance of guidelines contained in Notification No. FEMA

5/2000-RB dated 3rd May 2000 read with subsequent amendments and Volume II of

Book of Instructions as well as circulars issued by Central Office, regarding maximum

amount of loan, interest rate, margin, purpose etc.

8.1.2.Advances against FCNR/NRE deposit to the depositor himself or to a third

party should be granted up to a maximum of Rs.100.00 lacs only, only under his

specific request/mandate and after verifying the authenticity of the signature of the

depositor. If the NRI availing the loan is on a visit to India, the loan documentation

could be completed at the branch, where he proposes to avail of the facility. If the NRI

seeks to avail of loan from the branch in India, when he is abroad, the loan document

(60 H) should be sent to the NRI abroad with a request to execute the documents at an

Overseas Branch or at the branch office of the Correspondent of our Bank and arrange

to forward the documents along with the deposit receipt (carrying the undated

discharge of the depositor/s) through the overseas branch/office of the correspondent

bank where the documents were executed. A copy of the passport of NRI should also

be called for along with the application and discharged deposit receipt.

8.1.3.The covering letter of the overseas branch/Correspondent bank forwarding the

documents should confirm that the depositor had called on them and executed the

documents in their presence. On receipt of documents, branch can affix and effectively

cancel the revenue stamp on the reverse of deposit receipt where the undated


7/32

discharge of the depositor/s appears and proceed to grant the loan. The proceeds of

loans so granted could be credited to the NRO account only of the NRI availing the

loan. Under no circumstances, the loan proceeds should be credited to NRE/FCNR

accounts of NRIs or repatriated abroad.

8.2.1.Branches have to propose to their Regional Office for sanction of loan against

NRE deposits to third parties.

8.2.2.Branches should not grant advances to third parties against NRE/FCNR B

deposits on the basis of Power of Attorney.

8.2.3.In case of any loan / overdraft availed by a resident and who subsequently

became a person resident outside India, in terms of Reserve Bank guidelines under

FEMA 1999, it is left to the discretion and commercial judgement of the authorised

dealer / branch to allow continuance of such facilities. In such cases, payment of

interest and repayment of loan may be made by inward remittance or out of legitimate

resources in India of the person concerned. As per Reserve Bank guidelines, authorised

dealers at their discretion / commercial judgement, are permitted to allow overdrawing

in NRE SB account for a period not more than two weeks, up to a limit of Rs.50,000

subject to the condition that such overdrawing together with the interest payable

thereon are cleared/repaid within the said period of two weeks, out of inward

remittance through normal banking channels or by transfer of funds from other

NRE/FCNR accounts. However, branches should be guided by our Banks discretionary

powers for various branches communicated from time to time, before considering such

requests from their NRI customers.

8.3.Branches should note that the loan/overdraft facilities granted to NRIs in India

against the security of NRO/NRE/FCNR B deposits could be adjusted

(a)by foreign inward remittance, or

(b)from the proceeds of deposits held as security, or

(c)to the debit of the NRO/NRE account of the borrower.

When a loan granted to a NRI against the security of his/her NRE/FCNR deposit is

adjusted out of the rupee resources held in NRO account, branches should note to

recover interest as laid down by Central Office in Interest Rate on Advances circulars.

8.4At the time of sanctioning credit facility against the NRE/FCNR deposits, branch


8/32

should necessarily obtain instructions from the depositor, well before the due date, for

adjustment/roll over of the facility on the due date. Branch should send deposit

maturity notice along with details of the facility outstanding and the instructions

already in place. If any change in instructions is given by the depositor, branch shouldtake note of the same. As any interest rate movement/exchange rate movement will

result in complaints from customers, branches should take adequate care on this issue

9.BLOCKED ACCOUNTS

9.1.The Reserve Bank of India has powers to block accounts in India of any person,

whether an individual, firm or company resident outside India and to direct that

payment of any sums due to that person shall be made to such blocked account. A

blocked account means an account opened as a blocked account at any branch or

office in India of a bank authorised in this behalf by Reserve Bank of India. No blocked

account may be opened by a branch or an existing free account blocked, except

under directions of Reserve Bank of India. No blocked account should be un blocked by

a branch except under specific direction from Reserve Bank of India.

9.2.The Reserve Bank of India will issue special directions regarding operations on

individual blocked accounts at the time of authorising opening of such blocked

accounts.

9.3.Submission of STAT 2 return to the Reserve Bank for blocked accounts has been

dispensed with.

Annexures:

I Comparative chart showing the salient features of NRO and NRE deposit schemes.

II Account Opening Form for NRE Account.

ANNEXURE I

RUPEE ACCOUNT OF NON-RESIDENTS OTHER THAN BANKS

NON-RESIDENT (ORDINARY) NRONON-RESIDENT (EXTERNAL) NRE

1.WHO CAN OPEN:


9/32

Any person resident outside India

(other than a person resident in Nepal

and Bhutan) (Opening of accounts of

individuals / entities of Pakistan /

Bangladesh nationality / ownership as

well as erstwhile OCBs require prior

approval of Reserve Bank of India).

Non-Resident individuals of Indian

Nationality or origin (Opening of NRE

accounts in the names of Pakistani /

Bangladeshi individuals / entities require

prior approval of Reserve Bank of India).

2. SOURCE OF FUNDS :

Proceeds of remittances received in

any permitted currency from abroad or

any permitted currency tendered by

the account holder during his

temporary visit to India or transfers

from rupee accounts of Non-Resident

Banks.

Legitimate dues in rupees of account

holder in India.

Transfer from NRE/FCNR accounts.

Designating existing account as NRO,

of a person proceeding abroad (other

than Nepal or Bhutan) which would

give him the status of a NRI.

Remittances received from abroad in an

approved manner in freely convertible

currency, Transfer from NRE/FCNR

accounts.

Accounts may be opened in the name of

any eligible NRI during his temporary visit

to India against tender of foreign currency,

TCs issued in his own name or notes and

coins tendered provided the branch is

satisfied that the status of the person

continues to be a non-resident.

Branches should ensure that TCs and

currency notes tendered by the account

holder have in fact been brought by himfrom abroad and not acquired locally.

Transfers from NRO account to NRE account

are permitted subject to the ceiling of

USD 1 millionalready available for

repatriation from NRO accounts

3. TYPE OF DEPOSIT:

SB, CD, Term Deposit SB, CD, Term Deposit

4. GL CODE :

Same as ordinary deposit.

SB NRE 1301

CD NRE 1501

NRE TD (S) 1101

TD NRE (L) 1151

5. PERIOD OF DEPOSIT :


10/32

TD - 15 days to 120 months TD 12 months to less than 60 months

6. INTEREST :

SB & TDAs applicable to domestic

deposits.

SB - 3.5 % p.a.

TD-BASED ON LIBOR

Depending on period of deposit

(For current rates refer circular issued by

Central Office). No additional interest is

payable on deposit accounts of staff

members.

7. JOINT ACCOUNT :

Allowed with resident.

- Joint NRE accounts in the names of two or

more non-resident individuals is permitted

provided all the account holders are

persons of Indian Nationality or Origin. If the

spouse of an NRI is a foreign national, the

status of such a person will be that of a

Person of Indian Origin. However, such

persons are permitted to have only joint

bank accounts along with the spouse.

Residents can also be joint account holders

in NRE accounts on a former or survivor

basis.

8. REPATRIATION :

Not repatriable except for the following

in the account 1) Current income.

2) Up to USD 1 million per financial

year for any bonafide purpose out of

the balances in NRO account/sale

proceeds of assets in India acquired by

way of inheritance/ legacy inclusive of

assets acquired out of settlement

subject to certain conditions.

Freely repatriable.

9. NOMINATION :

Nominee can be a person resident in

India or a person resident outside

India. In the case of Non-resident

nominee, the amount entitled to him

Nominee can be a person resident in India

or a person resident outside India. In the

case of Non-resident nominee, authorised

dealers are allowed to remit funds lying in


11/32

from the account(s)/deposit(s) of a

deceased person will be credited to his

NRO account and the repatriation will

be subject to the overall ceiling of USD

1 million per financial year, subject to

taxes.

the account of the deceased account

holder.

10. TAX :

Tax at the rate of 30 % on the interest

income is to be deducted at source and

remitted to Government. If the Non-

Resident is from any of the countries

with whom Double Taxation Avoidance

Agreement is entered into, the

applicable rate will be deducted.

Income from interest on monies standing

to the credit of NRE accounts is exempt

from Income Tax. Balances held in the

accounts are exempt from Wealth Tax. Gifts

made to close relatives in India from out of

balances in such accounts are also free

from Gift Tax. (These Tax exemptions are

available only in respect of NRE accounts

maintained by NRIs and any fresh directive

issued will prevail)

11. PREMATURE CLOSURE :

If the deposit is up to Rs. 5 lakhs,

applicable interest for the period run

prevailing on the date of deposit is

payable without foreclosure charges.

1% less than the rate applicable for theperiod the deposit has run prevailing

on the date of deposit, additional

interest for bulk deposits of Rs.15 lakhs

and above, is not payable on

foreclosure.

In case of an overdue deposit renewed

with overdue interest, is closed

prematurely before completing the

minimum period for which suchdeposits are accepted from the date of

renewal, no interest is payable on the

renewed deposit and the interest paid

for the overdue period should also be

recovered.

1% less than the applicable interest for the

period the deposit remained with the bank

prevailing on the date of deposit. Additional

interest, if any, payable on bulk deposit ofRs.15 lakhs and above is not payable.

If an overdue deposit renewed with interest

payment for the overdue period, is closed

prematurely before completing the

minimum period for which such deposits are

accepted from the date of renewal, no

interest is payable on the deposit and the

interest already paid for the overdue period

should also be recovered.


12/32

12. RENEWAL OF DEPOSIT :

Can be done as per Rules as applicable

to domestic deposits.

Renewal of deposit can be done as longas

the depositors status is NRI. Renewal must

be made within 14 days from the due date

to get retrospective effect and must be

renewed for the minimum period

prescribed. If the overdue period is less

than one year, the interest rate for one year

prevailing on date of maturity or renewal,

whichever is lower, is to be applied.

13. CHANGE OF STATUS :

NRO accounts should be redesignated

as resident accounts on the return of

account holder to India, provided the

branch is satisfied that the account

holder has returned to India for taking

up employment, business or vocation

or for any other purpose indicating his

intention to stay in India for an

uncertain period. Where the account

holder is on a temporary visit to India,

the account should continue to be

treated as Non-resident even duringsuch visits.

NRE accounts should be redesignated as

resident rupee accounts or as RFC accounts

(if eligible) at the option of account holder

immediately upon the return of account

holder to India provided the branch is

satisfied that he has returned to India for

taking up employment or for carrying on a

business or vocation or for any other

purpose with an intention of residing in

India for an uncertain period.

Where the account holder is only on a short

visit to India, the account may continue tobe treated as NRE account even during his

stay in this country.

In respect of funds held in fixed deposits in

NRE accounts, interest will be payable at

the rate originally fixed, provided the

deposit is held for the full term even after

conversion into resident account.

14. OPERATIONS IN THE

ACCOUNT :Branches may allow transactions in

NRO accounts complying with

instructions contained in FEMA

Notification No. FEMA 5/2000-RB dated

3rd May 2000.

At the time of opening of the accounts,

14. OPERATIONS IN THE ACCOUNT :

Branches may allow transactions in NREaccounts complying with instructions

contained in FEMA Notification No. FEMA

5/2000-RB dated 3rd May 2000.

At the time of opening of the accounts, the

account holders should give an undertaking

that in cases of debits to the accounts for


13/32

the account holders should give an

undertaking that in cases of debits to

the accounts for the purpose of

investment in India and credits

representing sale proceeds of

investments, they would ensure that

such investments/ disinvestments

would be covered by the general or

special permission of Reserve Bank of

India.

Credits: Proceeds of remittances in

any permitted currency from outside

India through normal banking channels

or any permitted currency tendered bythe account holder during his

temporary visit to India or transfers

from rupee accounts of non-resident

banks. Other legitimate dues in India of

the account holder.

Debits: All local payments in rupees

including payments for investments

subject to compliance with the relevant

regulations made by the Reserve Bank

and remittance outside India of current

income in India of the account holder

net of applicable tax.

A resident can be authorised by the

NRI by way of Power of Attorney or

Mandate Letter to operate the NRO

accounts. The withdrawals are

restricted to local payments only by

the mandate holder. Operations on the

account in terms of Power of Attorney

is restricted to withdrawals for

permissible local payments or

remittance to the account holder

himself through normal banking

channels.

the purpose of investment in India and

credits representing sale proceeds of

investments, they would ensure that such

investments/ disinvestments would be

covered by the general or special

permission of Reserve Bank of India.

Credits: Proceeds of remittances in any

permitted currency from outside India

through normal banking channels or any

permitted currency tendered by the

account holder during his temporary visit to

India or transfers from rupee accounts of

non-resident banks. Other legitimate dues

in India of the account holder.Debits: All local payments in rupees

including payments for investments subject

to compliance with the relevant regulations

made by the Reserve Bank and remittance

outside India of current income in India of

the account holder net of applicable tax.

A resident can be authorised by the NRI by

way of Power of Attorney or Mandate Letter

to operate the NRE accounts. The

withdrawals are restricted to local

payments only by the mandate holder.

Operations on the account in terms of

Power of Attorney is restricted to

withdrawals for permissible local payments

or remittance to the account holder himself

through normal banking channels.


14/32

SUBMISSION OF STATEMENTS

Treasury dept. with the assistance of ITD, CO has developed a programme to cull

out the data from the core server and the same is being successfully transmitted to

Reserve Bank of India. In view of the above branches and Regional offices need not

submit NRD CSR data. However, the updation with regard to country codes and

transaction codes will have to be continued

(Ref.Treasury(Foreign) Perm.Cir. 87 dated 19.03.2010)

ANNEXURE II

INDIAN OVERSEAS BANK

ACCOUNT OPENING FORM

(A LATEST ACCOUNT OPENING FORM IS AVAILABLE IN http://www.iob.in)

ANNEXURE III

SECTION B FOREIGN CURRENCY ACCOUNTS IN INDIA

1.Branches should be guided by instructions contained in Notification No. FEMA

5/2000-RB dated 3rd May 2000, master circulars issued by RBI and circulars issued

by Central Office from time to time, with regard to opening and maintaining Foreign

Currency accounts in India.

2.Non Resident individuals of Indian nationality or origin (NRIs) are permitted to

maintain foreign currency accounts/deposits in India under special schemes. Non-

resident Indians returning to India are also permitted to open foreign currency

accounts with designated branches under different schemes. Overseas Corporate

Bodies have been de recognised as a class of investor, under FEMA, w.e.f.16.09.2003. The guidelines relating to the following type of accounts are furnished

in this chapter. (i) Foreign Currency (Non-Resident) Accounts (Banks) Scheme

FCNR(B)

(ii) Resident Foreign Currency (RFC) Accounts.

(iii) Resident Foreign Currency (Domestic) Accounts

The guidelines relating to Exchange Earners Foreign Currency Accounts are
http://www.iob.in/http://www.iob.in/


15/32

furnished in Chapter 1 of this volume of Book of Instructions.

3. Branches should extract balances in SB accounts in foreign currency every

month and tally with GL. In respect of term deposits maintained in foreign currency,branches should extract balances every half-year end and tally with GL.

4. Branches should ensure that correspondence from account holders maintaining

foreign currency accounts are properly attended to without giving room for any

complaints. Account Opening forms and all correspondence relating to such

deposits must be properly filed and kept.

FOREIGN CURRENCY NON-RESIDENT (BANKS) ACCOUNTS - FCNR (B)

1.Under FCNR(B) Scheme, the exchange risk is borne by the respective Banks

which maintain the accounts.

2.The accounts are maintained in designated foreign currencies and the account

holder is not exposed to any exchange risk.

3. DESIGNATED BRANCHES

Only branches which are designated by Central Office to maintain FCNR (B)

deposits should handle such deposits. Other branches are not permitted to

maintain FCNR (B) deposits. Such restriction is made to ensure prompt reporting

system and efficient management of funds. The list of authorised branches is

displayed in the TREASURY (FOREIGN) intranet site.

4. ELIGIBILITY :

Individuals of Indian nationality or origin (NRIs) as defined under NRE Accounts

Scheme are eligible to open deposit accounts under the captioned scheme.

5.DESIGNATED CURRENCIES :

Deposits can be opened only in the following designated currencies viz., US Dollar,Pound Sterling, EURO, Japanese Yen, Canadian Dollar Swiss Franc,New Zealand

Dollar and Australian Dollar

6.TYPE OF ACCOUNT, PERIOD AND RATE OF INTEREST :

6.1. Accounts are permitted to be opened only in the form of term deposits.

Our Bank permits opening of term deposits as RDP only for the following


16/32

maturities:

(a)One year and above but less than two years

(b)Two years and above but less than three years

(c)Three years and above but less than four years

(d)Four years and above but less than five years

(e)Five years only

GL CODE : FCNR-B (S) 1108

FCNR-B (L) 1158

6.2.Our Foreign Exchange Department, Central Office advises the interest rates

and it must be updated every month on the first working day irrespective of

whether any operation is there or not for all currencies in FCNRB. Interest should be

calculated on the basis of 360 days per year as per International practice.

6.3. No additional interest is payable on deposit accounts of staff members.

7.JOINT ACCOUNT:

The account may be held singly or jointly only in the names of eligible persons.

8.OPENING OF ACCOUNTS:

8.1.FCNR(B) should be opened only after citing the credit in our Nostro account. The

eligible person should submit application in the form prescribed (Annexure - I) for

opening FCNR(B) - RDP account, duly filled in and signed, supported by required

documents.

8.2. The account may be opened in the name of the eligible person by fresh

remittance from abroad through normal banking channel or by transfer from theirNRE/FCNR account.

8.3.The account may be opened by Non-Residents during their visits to India with

foreign currency travellers cheques in his/her own name or foreign currency notes.

While doing so, branches should be satisfied that he/she is still a Non-Resident

Indian. Branches should call for Currency Declaration Form (CDF) - wherever
http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#annex1http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#annex1


17/32

applicable - for endorsement and keep a photocopy of the same on record.

8.4. Remittances from abroad for opening/crediting to FCNR (B) accounts would

ordinarily be made only in the designated currency in which the account is desiredto be opened/maintained. If, however, remittance is received in a currency other

than the designated currency (including funds received in rupees by debit to the

account of a non-resident bank) it will be converted into the designated currency at

the prevailing rate by the branch at the risk and cost of the remitter and the

account opened/maintained in the designated currency.

8.5. MINIMUM AMOUNT OF DEPOSITS:

Branches should accept deposits with minimum size stipulations as advised by

Treasury (Foreign), Central Office from time to time.

CURRENCY AMOUNT MINIMUM

GBP 1000

USD 1000

EURO 1000

JPY 100000

CAD 1000

AUD 1000

8.6. As a rule, branches should pass account opening entries only after

receipt of funds in our Nostro Account. Hence opening of FCNR(B) deposit

by purchasing relevant instrument by debit to DBP(F) is prohibited.

9. RENEWAL OF DEPOSITS :

9.1.If the depositor has given automatic renewal instruction, the matured deposit

could be renewed on maturity without reference to the account holder.

9.2. In the absence of automatic renewal instruction, if the deposit is not renewed

on the date of maturity and renewed subsequently, then overdue interest for the

broken period will be paid at the RFC SB rate (simple) prevailing on the date of

maturity.

Back dated renewal of deposit is not permitted

10. PREMATURE CLOSURE:

Reserve Bank has stipulated that while Banks should permit premature withdrawal


18/32

of deposits under the scheme, they are free to levy penalty for such premature

withdrawal at their discretion. Banks may also, at their discretion, levy penalty to

recover the swap cost in the case of premature withdrawal of FCNR (B) deposits.

The components of penalty should be clearly brought to the notice of the depositorsat the time of acceptance of deposits and if it is not done, the exchange loss arising

out of premature withdrawal will have to be borne by the Banks.

Our Banks present guidelines on premature closure of FCNR(B) deposit are as

under

(a)No interest is payable if the deposit is closed before one year.

Interest is paid at the eligible rate for the period the deposit has run minusa

penalty of 1% on premature closure of the deposit for payment.

Interest is paid at the eligible rate for the period the deposit has run without any

penalty, if such closure is for renewal.

(b) Overdue interest, paid if any, at the time of renewal of the deposit which is now

closed before maturity, will be recovered if the deposit has run for a period of less

than 6 months and need not be recovered if such foreclosure takes place after 6

months.

11.PAYMENT OF DEPOSITS:

Maturity proceeds of FCNR (B) accounts or premature withdrawal thereof for the

purpose of meeting local disbursements in India should be converted into rupees at

TT buying rate for the relative currency ruling on the date of withdrawal and should

be routed through the account of the depositor. Branches should exercise

utmost caution and care when they receive instruction for closure (on

maturity or foreclosure) and repatriation by Fax or e-mail. They should

verify its authenticity and seek confirmation from the depositor before

acting upon such messages

12.Any inland movement of funds for the purpose of operating FCNR (B) accounts

as well as for repatriation abroad for balances held in FCNR (B) accounts would be

free of inland exchange or commission, for non-resident depositors.

13. WHEN THE DEPOSITOR BECOMES RESIDENT:

When the NRI returns to India for permanent settlement, the following options are

available to him regarding treatment of FCNR(B) deposit with unexpired maturity:

(a)Retain the FCNR(B) deposit as per the original terms till maturity, i.e., the

original contracted rate of interest on FCNR(B) deposit will be paid till maturity for

the contracted period. On maturity, convert the FCNR(B) deposit as RFC Deposit (if


19/32

eligible) or as a Rupee deposit at TT buying rate prevailing on the date of

conversion.

(b)If the depositor requests for premature closure of FCNR(B) deposit and

conversion to RFC deposit, penal provisions shall not be applicable. However, if thedepositor requests for premature closure and conversion to rupee deposit, penal

provisions shall apply.

14 NOMINATIONS:

14.1. Nomination facility is available to FCNR(B) depositors as in any other deposit

accounts.

14.2. Resident nominees may be allowed funds (From out of their share of

proceeds of Non-Resident Indians deposits) towards liquidation of liabilities of the

deceased NRI depositor at the overseas centre, before settling the claim.

14.3. INTEREST PAYABLE ON FCNR(B) DEPOSIT OF A DECEASED

DEPOSITOR/S:

Branches should note the following guidelines while settling claims in the case of a

deposit standing in the name/s of

(i)a deceased individual depositor, or

(ii)two or more joint depositors, where one of the depositors had died. Interest on

such FCNR(B) deposit/s of the deceased depositor, shall be paid as indicated

below :

I. At the contracted rate on maturity of the deposit.

II.In the event of the heir/s, legal representative/s or nominee/s claiming the

payment of the deposit before maturity date, branches will pay interest at the rate

as applicable for the period for which the deposit has run (as prevailing at the time

of opening of the deposit in question) without levying any penal interest.

III.In the event of death of the depositor before the date of maturity of the deposit

and the amount is claimed after the date of maturity, the bank should pay interest

at the contracted rate till the date of maturity. From the date of maturity to the

date of payment, the bank should pay simple interest at the applicable rate

operative on the date of maturity, for the period for which the deposit remained


20/32

with the bank beyond the date of maturity.

IV.If the depositor dies after the date of maturity of the deposit, the bank should

pay interest at a rate operative on the date of maturity in respect of savingsdeposits held under RFC account scheme, from the date of maturity till date of

payment, appropriate to the currency of the deposit, irrespective of the fact

whether the heir/s, legal representative/s or nominee/s seek renewal of the

deposit/s or seek repatriation of the amount, subject to the condition that they are

eligible to receive the claim in foreign currency.

V.If the heirs, legal representatives or nominees seek splitting of the deposit and

issuance of two or more receipts individually in the name of heir/s, legal

representative/s or nominee/s, such splitting shall not be construed as premature

closure and no penalty will be levied provided the period and the aggregate amount

of the deposit do not undergo any change.

VI.If the legal heir/s are residents, then the maturity proceeds may be converted

into Indian rupees on the date of maturity and for the subsequent period the

interest shall be payable at a rate applicable to the deposit of similar maturity

under the domestic deposit scheme.

15. LOANS AND OVERDRAFTS

15.1. TO THE DEPOSITOR

Branch may extend loans and advances to the depositor against his deposit for

purposes other than prohibited investments subject to compliance of prescribed

margin norms and rate of interest as per Central Office circulars in force. The

general guidelines stated in paragraphs 9.1.1. to 9.4 of this chapter under section

A shall apply for loans and advances granted against the security of FCNR B

deposits. Reserve Bank has prohibited Banks from granting fresh loans or

renewing existing loans in excess of Rupees 100 lakhs against FCNR (B)

deposits either to the depositor or third parties. The loan proceeds is to becredited to NRO Account and not to depositors NRE Account.

15.2.The loan can be repaid either by fresh remittance from abroad or out of

maturity proceeds of the deposit. The loan can be repaid out of funds held in

his/her NRO account.
http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#para911http://172.16.0.5/BOI2011/After_Convert_Html%20(Vol%203)/CHAP-2%20-NRI%20OTH%20THAN%20BKS.html#para911


21/32

15.3.TO THIRD PARTIES

Branch may propose to their Regional Office for loans to third parties who are

residents in India against FCNR (B) deposits, subject to following conditions:

(a)There should not be any direct or indirect foreign exchange consideration for thenon-resident depositor agreeing to pledge his/her deposit, to enable the resident

individual/firm/company to obtain the facility.

(b)The period of loan should not exceed the unexpired period of maturity of the

deposit accepted as security. The non-resident depositor should furnish an

irrevocable undertaking to the branch not to withdraw the deposit during the

pendency of loan/overdraft.

(c)The loan should be utilised for personal purposes or for carrying on business

activity other than prohibited purposes.

(d)Branches should satisfy themselves as to the acceptability of purpose,

genuineness of the credit needs of the borrower and end use of funds. They should

not be guided solely by the availability of security.

(e)Branches should comply with prescribed margin norms and rate of interest as

per Central Office circulars in force.

15.4.Branches should be guided by Documentation procedure for loans against

NRE deposits set out in this Chapter while granting loans against FCNR(B) deposits.

16.FORWARD COVER TO NON-RESIDENT INDIANS

Branches are now permitted to book forward cover for their Non-Resident Indian

customers against their FCNR(B) and NRE deposits. Branches should refer to

detailed guidelines furnished in the Chapter No. 7 titled Forward contracts of this

volume of Book of Instructions.

17. REPORTING

17.1.Branches should send system generated reports of opening/ renewal / closure

of FCNR(B) Deposits in the prescribed format promptly.

17.2. NAD branches authorised to handle FCNR deposits should forward suchreports to the respective AD branch.

17.3The quarterly FCNR B reconciliation statement should be thoroughly

scrutinised and submitted after reconciliation along with necessary

opening/renewal/closure reports.


22/32

18.STATEMENT

As per extant guidelines, branches should do the updation with regard to the

country codes and transaction codes.The Foreign Exchange Department, Central

Office, would send the statement NRD-CSR for the bank as a whole to Reserve Bankof India, Mumbai.

19. FCNR SUSPENSE ACCOUNT NAD BRANCHES

19.1.The FCNR (Suspense) Account should not be used by any branch for any

purpose.

20. Branches should be guided by instructions contained Master Circular on FCNR B

and amendments thereto by AP (DIR) circulars issued by Reserve Bank of India.

RESIDENT FOREIGN CURRENCY ACCOUNTS SCHEME (RFC Accounts)

All AD Branches are permitted to open RFC accounts subject to compliance of

instructions laid down in Foreign Exchange Management (Foreign Currency Accounts by

a person resident in India) Regulations, 2000 Notification No. FEMA 10/2000-RB dated3rd May 2000 and subsequent amendments as well as other instructions issued by

Central Office from time to time.

1. Eligibility

1.1.Under this scheme, persons of Indian nationality or origin, who having been resident

outside India for a continuous period of not less than one year and have become

persons resident in India on or after 18th April 1992 are eligible to open and maintain

RFC accounts with branches in a freely convertible foreign currency. (For arriving at the

period of continuous stay abroad of not less than one year, short visits to India on

personal grounds like meeting family members/relatives or on health grounds which do

not indicate the persons intention to stay in India for an indefinite period may be

ignored)

1.2.Persons who return to India after a short assignment of less than one year abroad


23/32

desiring to have RFC accounts should apply through the branch to RBI in form RFC. RFC

accounts opened with the specific approval of RBI will be governed by the conditions

stipulated by RBI while granting such approval.

1.3.Persons who returned to India prior to 18th April 1992 after having been residentoutside India for a continuous period of not less than one year are also eligible to open

RFC accounts if:

a.They are holding valid specific permission/license from RBI as on 17-4-92 to maintain

foreign currency accounts or to hold other foreign currency assets abroad

or

b.They are in receipt of pension or other monetary benefits from their overseas

employers subsequent to their return to India even if they did not maintain foreign

currency accounts or hold other foreign currency assets abroad.For the purpose of this Scheme, a person (not being a citizen of Pakistan or Bangladesh)

shall be deemed to be of Indian origin, if:

i.he at any time held an Indian passport

or

ii.he or either of his parents or any of his grandparents was a citizen of India by virtue

of the Constitution of India or the Citizenship Act 1955

or

iii.that person is the spouse of an Indian citizen or of a person of Indian origin (not

being a citizen of Pakistan or Bangladesh)

2. Nature of Account:

2.1.The RFC account can be maintained in the form of term deposits or Savings Bank

Account (without cheque book facility). The Savings Bank account will be without

cheque book facility and the minimum balance is USD 500 to become eligible for RFC SB

interest.

The period of term deposit in the form of RDP would be as under:

i)Six months and above but less than One year

ii)One year and above but less than Two years

iii)Two years and above but less than Three years

iv)Three years only

Beyond 12 months, the deposits can be accepted in multiples of 3 months only.


24/32

2.2. GL/Profit and Loss account codes for such accounts are:

RFC SB Account 1205

RFC SD/TD Deposit Account 1105

Interest Paid on RFC deposit account 5121

2.3.The eligible person should submit application in the form prescribed (Annexure I A),

duly filled in and signed supported by required documents. Branches can open the

account on being satisfied that the applicant is an eligible person and that funds being

credited to the account represent remittances out of eligible assets.

2.4. Branches should have a separate Account Opening Register and suitable account

numbers for SB and TD may be given as RFC-SB and RFC-TD etc. Branches may issue

standard SB pass books for RFC-SB accounts after making necessary modifications.

Standard Deposit Receipts may be issued for RFC term deposits.

2.5. Branches may at the option of RFC depositor obtain an undertaking for automatic

renewal of deposits on due date.

3. Joint Account:

The account may be held singly or jointly only in the names of eligible persons.

4. Currency of Account:

The account can be denominated in any of the following currencies:

USD, GBP, JPY, EURO, CAD and AUD

FEDAI weekly average rates published by TREASURY (FOREIGN) every quarter will be

used for accounting purposes instead of the notional rates used earlier.

5. Renewal of overdue RFC deposit and interest payment for overdue period.

5.1. Overdue RFC deposits cannot be renewed from back date. Such deposit can be

renewed from prospective date only.

5.2. For the overdue period, branches are permitted to pay interest at the RFC SB rate

(simple) appropriate to the currency of deposit, prevailing at the time of maturity or at

the time of renewal, whichever is lower.

5.3. If such renewed deposits are closed before completion of 6 months, then the

overdue interest paid on such renewed deposits should be recovered. No interest is

payable on the deposit as it would not have run for the minimum period.


25/32

5.4. Recovery of swap charges has been dispensed with for the time being.

5.5. In case of premature closure, whether overdue interest has been paid or not,

branches will pay interest at the rate applicable to the period for which the deposit hasrun, as prevailing on the date of opening/renewal less one percent penalty.

6. Credits to the Account

Under noted credit transactions may be allowed by branches in RFC accounts:

6.1. Remittance in convertible foreign currency from outside India through normal

banking channels representing:

i.Funds in bank accounts outside India forming part of eligible assets held by theeligible person.

ii.Income such as dividend, interest, profit, rent, etc. earned on eligible assets held by

the eligible person.

iii.Sale proceeds of eligible assets.

6.2. Pension or other monetary benefits received from outside India in convertible

foreign currency, through normal banking channels, arising out of employment taken up

outside India by the eligible person prior to his returning to India.

6.3. Interest earned on RFC account.

6.4. Foreign currency notes/travellers cheques brought into India by the eligible person,

provided that where the amount tendered exceeds USD 10000 or its equivalent or

where the value of foreign currency/bank notes exceeds USD 5000 or its equivalent they

have been declared on the Currency Declaration Form.

6.5. Transfers from other RFC accounts of the account holder.

6.6. Balances in any NRE/FCNR Account (other than in NRE rupee accounts of persons

resident in the erstwhile Bilateral Group countries which have been funded in non-

convertible rupees) in the name of the eligible person standing to his credit at the time

of his arrival in India. (No penalty would be payable for premature withdrawal of

NRE/FCNR deposits in such cases).


26/32

6.7. Unutilised entitlements under any valid RIFEE permit or Reconversion facility

granted by RBI.

6.8. Unspent foreign exchange surrendered by RFC account holders can also be

accepted provided the branch is satisfied that the foreign exchange/currency concernedhad in fact been released for travel etc. abroad by debit to the same RFC accounts and

the amount of foreign exchange/currency is surrendered within the stipulated period as

required under the Exchange Control Regulations.

(Eligible Assets Assets acquired or held otherwise than in contravention of the Act by

an eligible person, while he was resident outside India (non-resident), in the form of

deposits in banks outside India, investments in foreign currency shares or securities or

immovable properties situated outside India or investments in business etc. outside

India and include foreign exchange earnings through employment, business or vocationoutside India taken up or commenced by such person while he was resident outside

India).

7. Debits to the Account

7.1. The funds in the account may be allowed to be freely utilised by the account holder

for bonafide remittance outside India through normal banking channels including for

investments abroad provided the cost of such investments and/or subsequent payments

required there for are met out of RFC account.

7.2. Branches may permit withdrawals/payments from such accounts (other than for

remittances) outside India, or for payments in foreign currency authorised to be made in

India by RBI only in equivalent Indian rupees.

8. Rate of Interest

Rates of interest on deposits held under this scheme are advised by TREASURY

(FOREIGN), Chennai on a monthly basis. For RFC-SB accounts, interest will be payable

every quarter on the last working day of the quarter on product-wise calculations. For

RFC- term deposit accounts for the period 12 months and above, interest will be

compounded half yearly as in the case of FCNR B deposits. For term deposits of 6

months and above but less than 12 months, interest will be paid at a simple rate.

9. Loans/overdrafts against the deposits

No loan/overdrafts shall be granted by branches against balances in RFC accounts.

10. Nomination Facility


27/32

10.1. The RFC accounts shall have the nomination facility as in the case of resident

rupee account.

11. Transfer of Balances on becoming Non-resident

Funds held in RFC account may be freely remitted abroad or credited to fresh NRE/FCNRaccounts in the event of the account holder becoming non-resident by virtue of his

going abroad for employment etc.

12. Accounting Procedure:

Branches may refer to Permanent FX Circular No.32/92-93 dated 24.9.92 issued by

Foreign Exchange Department, Central Office. Enclose a copy of the circular

ANNEXURES

I. A. Application for opening RFC Account.

II. A. Daily Report of EEFC/RFC/FCA Transactions. (available in Chapter I EEFC

Accounts)

For any change in Accounting Procedure that may take place hereafter branches are to

be guided by the Circulars that may be issued by the Foreign Exchange Department,

Central Office.

RESIDENT FOREIGN CURRENCY (DOMESTIC) ACCOUNT

Reserve Bank vide FEMA notification No. FEMA 74/2002-RB dated November 1, 2002 has

allowed a person resident in India to open, hold and maintain with an authorized dealer

in India a foreign currency account to be known as Resident Foreign Currency

(Domestic) Account.

Accordingly all AD branches are permitted to open a foreign currency deposit account

for a person (INDIVIDUAL ONLY) resident in India subject to the norms/procedures given

below. Any RFC (D) deposit on account of NAD branch customers should be opened at

the nearest AD branch only.

1. Eligibility

Under the scheme, a person resident (individual) in India is eligible to open a RFC (D)

account.

2. Nature of Account

The RFC (D) account can be maintained in the form of Current Account only (without

cheque book facility).


28/32

3. Permitted Currency

The account can be denominated in anyone of the currencies permitted for FCNR (B) viz.

USD, GBP, EUR, JPY, AUD, CAD

4. Interest

No interest is payable on RFC (D) account.

5. Minimum and Maximum Balance

The minimum amount will be USD 500 or its equivalent in other currencies and there is

no maximum prescribed.

6. Permitted Credits

The following Credits are allowed in RFC (D) account

1.Out of foreign exchange acquired in the form of Currency Notes, Bank Notes and

Travellers Cheques while on a visit to any place outside India by way of payment for

services not arising from any business in or anything done in India

2.Amount received as a honorarium or gift or for services rendered or in settlement of

any lawful obligation from any person not resident in India and who is on a visit to India

3.Amount received by way of honorarium or gift while on a visit to any place outside

India

4.Represents the unspent amount of foreign exchange acquired by him from an

authorized person for travel abroad

5.Foreign exchange earned through export of goods and/or services, royalty,

honorarium etc., and/or gifts received from close relatives (as defined in Companies Act)

and repatriated to India through normal banking channels by resident individuals

7. Permitted Debits

Payments towards a current account transaction in accordance with the provisions of

Foreign Exchange Management (Current Account Transactions) Rules, 2000 and towards

a capital account transaction permissible under the Foreign Exchange Management


29/32

(Permissible Capital Account Transactions) Regulations, 2000 are allowed.

8. Accounting Procedure:

The accounting procedure, notional rate, reporting format/system will be same as in the

case ofRFC deposits.The GL head for RFC is used for RFC (D) deposits also. But forthe purpose of distinction, a separate ledger may be maintained for RFC (D)

deposits. For statistics/MIS purpose, branches should maintain Progressive balance and

balance should be tallied as per the existing norms/procedures.

ANNEXURE I A

APPLICATION FOR OPENING AN RFC ACCOUNT

To

The Manager

.........................................................

.........................................................

.........................................................

Please open an RFC Account in my name. The relevant particulars are as under :

1. Name and address of the applicant :

2. Nationality :

3.Origin (state whether you are of :

Indian origin)

4. Passport particulars :

No. :

Issuing Authority :

Expiry Date :

5. Date of arrival in India to :

become a resident in India

6.Particulars of residence outside India

COUNTRY

P E R I O DNATURE OF

OCCUPATION

FROM TO


30/32

(An attested copy of the relevant pages of the passport must be enclosed).

7. Do you continue to have any :

employment or business or vocationoutside India? If so please give

full particulars

8.Foreign currency/ies in which RFC :

Account/s is/are to be opened

9. Type of Account desired (State :

whether fixed deposit, current or

savings Account)

I hereby declare that I have gone through the provisions of the RFC Accounts Scheme. I

declare that the particulars stated herein above are correct and I am eligible to open

and maintain RFC Account under the Scheme as applied. I agree that the RFC Account

shall be governed by the RFC Accounts Scheme and the directions issued by the

Reserve Bank under the Foreign Exchange Regulation Act, 1973, from time to time.

Date : (Signature)

Place :

INSTRUCTIONS TO THE APPLICANT

1.Applicant is advised to read carefully the RFC Accounts Scheme before making the

application.

2.Account will not be opened unless full particulars are furnished in the application form.

3.Application form duly filled in and signed must be accompanied by copies of the

relevant pages of the passport duly certified by the applicant as true copies. Thepassport should be submitted along with the application for verification.

4.Furnishing any false information in the application amounts to a contravention of

FEMA 1999.

5.Applicant should furnish such other particulars or documents, as may be required by


31/32

the authorised dealer for the latter to satisfy himself that the applicant is an eligible

person and the funds proposed to be credited to the RFC Account are eligible for the

purpose.

6.Nomination facility is available to the RFC Accounts as in the case of resident rupee

accounts.

Annexure I B:

Undertaking from Depositor of FCNR B / RFC regarding penal provisions:

I /We understand that bank will be charging/levying penal interest /swap charges for

premature closure of the deposits (together with swap charges, if any), for any purpose

as per rules given hereunder and I agree for the same.

FCNR DEPOSITS:

1.If the FCNR (B) deposit has not run for 6 months, overdue interest paid, if any at the

time of renewal of the deposit will be recovered. No interest is payable on such deposits

as the deposit would not have run for the minimum period of 12 months as per RBI

stipulation.

2. If the deposit has run for 12 months and above, penal interest @ 1% (0.5%, if

premature closure is for the purpose of renewal) will be recovered.

RFC DEPOSITS:

1.If the deposit has not run for 6 month, but overdue interest paid, if any at the time of

renewal of the deposit will be recovered. No interest is payable on such deposits as the

deposit would not have run for the minimum period of 6 month as per RBI stipulation.

2.If the deposit has run for 6 month and above Penal interest @ 1% (0.5%, if pre mature

closure is for the purpose of renewal) will be recovered.

SIGNATURE OF THE CUSTOMER


32/32

Date post:	14-Apr-2018
Category:	Documents
Upload:	deepthi-ravichandhran
View:	217 times
Download:	0 times

Rupee Accounts of Non-residents Other Than Banks

Documents