Key differences between NRI NRE and NRO Bank Accounts
Last updated August 22, 2026
This IPO News guide/article covers “Key differences between NRI NRE and NRO Bank Accounts”. The page is organized around non-resident external (nre) account, non-resident ordinary (nro) account, nre vs nro account: know the differences, nre and nro account: which one is better?, zerodha trade@20. IPO News presents the structured facts and tables in its own layout and wording.
Topics Covered
- Non-Resident External (NRE) Account
- Non-Resident Ordinary (NRO) Account
- NRE Vs NRO Account: Know the differences
- NRE and NRO Account: Which one is better?
- Zerodha Trade@20
- Frequently Asked Questions
- 1. How NRE account is different from NRO account?−
- 2. As an NRI, can I open both NRE and NRO account?+
- 3. Is it mandatory to get PIS letter on NRO account?+
- 4. Who can open an NRO Account?+
- 5. Do NRIs have to maintain minimum balance in NRE or NRO account?+
- 6. How to fund an NRO Account?+
- 7. Why to open an NRE account?+
- 8. Why to open an NRO Account?+
- 9. What is the tax rate on NRO account?+
- 10. Can an NRI transfer funds from NRE to NRO account?+
- 11. Which account NRE or NRO is tax-free?+
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Key Facts
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- Yes, NRI NRE or NRO account are subject to minimum balance commitments ranged between Rs 5,000 to Rs 25,000 vary from bank to bank.
- Repatriate upto 1 million USD in a financial year to country of residence
- Interest earned on balance lying in the NRO bank account is subject to 30% TDS in addition to the cess and surcharge applicable.
- An NRI can transfer maximum of USD 1 million from NRO to NRE account subject to certain documentation requirements.
Data Tables
| NRE Bank Account | NRO Bank Account | |
|---|---|---|
| Purpose | NRE bank account is opened to transfer and deposit foreign earnings in Indian rupees. | NRO account is opened by NRIs to deposit the income earned in India like rental income, pension, dividend, etc. |
| Joint holdings | NRE account can have two NRIs or one NRI and one resident as a joint holder. | Same way, NRO account can also be open along with an Indian resident or another NRI. |
| Deposits | Only income earned overseas can be deposited into an NRE account. | NRI can deposit foreign as well as Indian earnings in the NRO account. |
| Fund withdrawal | NRI can transfer or withdraw NRE account balance to a foreign account. Further, NRE account deposits can be transfer to NRO or a resident account. | Money can be withdrawn in Indian as well as abroad but is allowed in Indian currency only. NRO account fund deposits cannot be transferred to an NRE account. |
| Taxation implications | Interest earned on NRE account balance is tax-free. | Interest earned on NRO account is subject to TDS applicability. |
| Repatriation or transferability facility | All deposits including principal and interest receipts are fully repatriable. | NRO Account deposits are not repatriable. Money from NRO account can be repatriated abroad upto maximum USD 1 million in a financial year however, interest is fully-repatriable. |
| Exchange rate risk | Prone to currency fluctuations or exchange rate risks. | Deposits in NRO account is less likely to be affected by exchange rate risks if both deposits and withdrawal are made in Indian rupee. |
| Equity investment | An NRE account needs PIS approval to buy and sell shares of listed Indian companies. | NRI holding NRO account in India does not require obtaining PIS letter to invest in Indian companies. |
| F&O trading | Not Available, NRE account does not allow equity derivative trading. | Available, NRO account can be used to trade in equity derivatives segment. |
| Investment in Mutual Funds | NRE account can be used to invest in mutual funds in India. | NRO account also allows investment in mutual funds. |
| Who can open? | A non-resident Indian (NRI) including PIOs, and OCIs are eligible to open NRE account. | Any non-resident can open an NRO account in India. |
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