Complete Guide To ICICI Bank's NRI Banking

For years now, ICICI Bank has established itself as a global organization that strives to cater to its Resident and Non-Resident Indian Account-holders and provide them with a world-class banking experience. Specifically, in the sphere of NRI banking, ICICI Bank has taken significant strides. This, with diverse offers aimed at being the most convenient, sought-after solutions for all banking needs; right from savings to advanced wealth management to international money transfers (remittances). This piece explores the purpose and benefits of some top-rated services in each of these categories.

      ACCOUNTS

As a Non-Resident Indian or otherwise, the primary use of a bank account is to earmark funds for the future, also known as savings. For NRIs, an added concern is the need to maintain both their foreign income and earnings back home, separately. Another requirement related to NRI Banking is to have one account with Indian Rupee as currency, and another, with the local currency. Here's where Rupee Accounts and Foreign Currency Accounts figure, each with their own sub-categories:

Rupee Accounts:

As per guidelines by the Foreign Exchange Management Act (FEMA), NRIs cannot have a Savings Account in India, in their name. It is important to note that in this purview, the definition of a Non-Resident extends to Persons of Indian Origin (PIO) and Overseas Citizens of India (OCI). They need to deposit the money earned abroad into a Rupee account known as Non-Resident External (NRE) Account while any income earned in India gets deposited into a Non-Resident Ordinary (NRO) one. 

The main accounts under NRI Banking are:

NRE Account: NRE is the abbreviation of Non-Resident External. This is a Rupee Account where you deposit your income earned outside India, like your salary in the USA. Since this is an Indian Account, the currency deposited should be in Indian rupees. One can convert the foreign currency and transfer it from one's country by using various money transfer operators. ICICI Bank's Money2India (www.money2India.com) is one such service that allows transfers from any bank account in the USA to any bank account in India. Once you park your foreign income into an NRE Account, there is no restriction on money movement between your account and a foreign account. NRE accounts are fully repatriable, which means sending money from a foreign country to India, and vice versa, is permissible. 

Do remember that the money you put into these accounts must be earned outside India. The other key benefits are; from the taxation perspective is that the interest accrued is not taxable in India, and no wealth tax applies on the entire amount in the account.

NRO Account: NRO is the abbreviation for Non-Resident Ordinary. This is the other type of Rupee Account, meant for NRIs to maintain and manage income earned in India, such as rent, dividends, pension etc. It is not repatriable, except for any current income. The most significant advantage for NRO Account-holders is that they can easily invest in Mutual Funds and Indian bonds, in addition to managing recurring income sources back home. However, this account is subject to taxation, and the interest earned is subject to TDS (Tax Deducted at Source).

Both NRE and NRO can be Savings, Current, Recurring or Fixed Deposit (FD) accounts, and can also be jointly owned by two or more NRIs/PIOs/OCIs or along with a Resident relative (for NRO accounts only). 

• Foreign Currency (Non-Resident) Account: The FCNR Account is a Fixed Deposit account that you can hold in your current residence country's currency. ICICI Bank allows booking of FCNR deposits in USD, GBP, EUR, CHF, SGD, CAD, AUD, HKD and JPY currencies. With this account, you can earn a fixed rate of interest until maturity. It is repatriable, non-taxable and can be held jointly in the name of two or more NRIs/PIOs/OCIs. Most NRIs are uncertain about this account's validity, should they return to India, upon which their Non-Resident status would be dropped. This is where RFC (Resident Foreign Currency) accounts come in handy. Once a person's residential status changes, they can carry on with the FCNR deposits until the date of maturity at the contracted rate of interest. Upon maturity, they can convert it into an RFC Account, and continue to hold funds in foreign currency (limited to USD and GBP).
• Premium, Special and Minor Accounts: Under its NRI Banking services ICICI Bank also provides a few priority accounts that cater to specific customers. 
• Premium Accounts come in five different variants, such as the NRI Pro, which offers unique benefits for your family in India and gives you access to preferential rates on money transfers and loans, or the NRI Seafarer Pro, designed for seafarer professionals. 
• Special accounts are primarily meant for mariners, who would have the flexibility to open a Savings Account in any currency and maintain the same in INR; and for students who can maintain a balance as low as INR 5,000 
•  Minor accounts can be opened for NRI minors upto 18 years of age, under guardianship, to inculcate the habit of saving at a young age.

     Remittances

    A major requirement of NRI banking is international funds transfer. With ICICI Bank Money2India, you can transfer funds from any bank account in the USA to not only your NRE Account but any account in India. Moreover, if you send USD 10,000 or above using Money2India into your ICICI Bank NRE Account in a year, your account gets upgraded to NRI Remittances Premia, which gives additional benefits of up to INR 25,000*. 

    Some of the key features of Money2India are:

• Any bank (USD) to bank transfer (India)
• Transfer up to USD 300,000 in a single transaction
• Served over 1.5 million customers over 18 plus years of existence
• Secured transfers with 128 bit SSL encryption

      LOANS

Under NRI Banking products the NRIs are eligible to apply for Home Loans, Personal Loans and loans against Fixed Deposits. 

• Home Loans: A host of products are available under the Home Loans umbrella, depending on your requirement, i.e. whether you want to purchase a home, build one, buy property, etc. For a better understanding, we recommend that you carefully peruse the eligibility conditions and a list of associated documents.

Some key benefits of leveraging ICICI Bank's offerings in this space are:

1. Loan repayment tenure up to 30 years
2. Doorstep assistance for aiding with the disbursement process
3. Existing database of projects pre-approved for funding
4. Option to avail floating or fixed interest rate

• Personal Loans: As an NRI, you could obtain a Personal Loan for various reasons, ranging from financing your wedding, renovating your home, bearing medical costs or any other unforeseen expenses. Here are some additional details on documentation, application criteria, etc.

Highlights of using this product:

1. No security/collateral needed
2. Option to avail loans up to Rs 10 lakh
3. Interest rates starting from 15.49% per annum
4. Tenure up to 36 months

• Overdraft against Fixed Deposit: Instead of liquidating your NRE, NRO or FCNR deposits in times of need, ICICI Bank allows you to borrow against them as an overdraft. You can draw as much as you need and pay interest only on the drawn amount till you repay. Chief advantages of using this route:

1. Loans available to self as well as third party individuals (Any individual / Corporate)
2. Loans available up to 90% of the deposits' principal amount (maximum INR 500 lakh)
3. Repayment can be made either by adjusting the Fixed Deposit or through fresh outward remittances, using ordinary banking channels
4. Loans can also be repaid using the funds accumulated in the borrower's NRO Account

     INVESTMENTS AND TRADING

     As a Non-Resident, you certainly retain your rights to invest money in some winning options back home. Everything from Mutual Funds, Bonds and Debentures to Real Estate and government securities would qualify as worthwhile investment opportunities. NRIs / PIOs / OCIs can also invest directly in the stock market under the Portfolio Investment Scheme (PIS) of RBI, and the funds for the same are debited from their NRE or NRO Savings Account. You could execute these trades through a combination of your NRE/NRO Account, a Brokerage Account and a Demat Account, and your transaction must go through a stockbroker. The easier alternative is using ICICI Direct, an easy solution to trading that comes in the form of a single 3- _n-1 integrated account that interlinks your Demat, Savings and Broking accounts. If you were to transact through this account, you would be trading real-time on Bombay Stock Exchange (BSE) and National Stock Exchange of India Limited (NSE). The portal also supplies information on market stats, top gainers, top losers, etc. 

    While all of these investment plans help you prepare for retirement, you could also    consider schemes like the National Pension Scheme (NPS), which largely focus on allocating monetary resources to be used post-retirement. 

     INSURANCE

The ICICI Group makes it possible to secure your future and your family's, by offering numerous Insurance Policies, some directly through ICICI Bank, the others through two subsidiaries, viz. ICICI Prudential and ICICI Lombard. ICICI Prudential is primarily for Term Insurance, a popular option sought by most NRIs. On the other hand, ICICI Lombard specializes in NRI Insurance, by putting together a whole portfolio of assurance products including travel, motor and home insurance, to help you secure your assets. 

While these are the four broad categories of products that the ICICI Group brings to the table for its Non-Resident customers, a deeper understanding of its constituent elements under each category would undoubtedly disclose many lesser-known perks and privileges. Regardless of what financial product or derivative you're seeking to channel your hard-earned money into, the ICICI stamp remains proof enough that you're placing your faith in the most experienced, well-intentioned and trusted institution in the banking sphere.

Terms and Conditions apply.