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Non-Resident (External) Rupee Account Scheme NRE Account

SCHEDULE 1 - FEMA - SCHEDULE 1 - SCHEDULE 1 [See Regulation 5(1) (i)] Non-Resident (External) Rupee Account Scheme - NRE Account 1. Eligibility: Non-resident Indians (NRIs) and Person of Indian Origin (PIOs) are permitted to open and maintain these accounts with authorised dealers and with banks (including cooperative banks) authorised by the Reserve Bank to maintain such accounts. The account should be opened by the non-resident account holder himself and not by the holder of the power of attor .....

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cy, deposited by the account holder in person during his temporary visit to India, provided the authorised dealer/ bank is satisfied that the account holder is still resident outside India, the travellers' cheques/ drafts are standing/ endorsed in the name of the account holder and in the case of travellers' cheques, they were issued outside India. c) Proceeds of foreign currency/ bank notes tendered by account holder during his temporary visit to India, provided (i) the amount was decla .....

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ible investment in India which was originally made by debit to the account holder's NRE/ FCNR (B) account or out of remittances received from outside India through banking channels. Provided that the investment was made in accordance with the foreign exchange regulations in force at the time of making such investment. h) Refund of share/ debenture subscriptions to new issues of Indian companies or portion thereof, if the amount of subscription was paid from the same account or from other NRE .....

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ittance from outside India through banking channels and the authorised dealer is satisfied about the genuineness of the transaction. j) Any other credit if covered under general or special permission granted by Reserve Bank. 4. Permitted Debits: a) Local disbursements. b) Remittances outside India. c) Transfer to NRE/ FCNR (B) accounts of the account holder or any other person eligible to maintain such account. d) Investment in shares/ securities/ commercial paper of an Indian company or for pur .....

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account holder: Authorised dealers and authorised banks maintaining such accounts are permitted to grant loans in India to the account holder subject to the following conditions: (a) The loan shall be used for: i) personal purposes or for carrying on business activities except for the purpose of relending or carrying on agricultural/ plantation activities or for investment in real estate business. ii) making direct investment in India on non-repatriation basis by way of contribution to the capi .....

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sed banks may grant loans to resident individuals/ firms/ companies in India against the collateral of fixed deposits held in NRE account subject to the following conditions: i) The loan should be utilised for personal purposes or for carrying on business activities except for the purpose of relending or carrying on agricultural/ plantation activities or for investment in real estate business. ii) There should be no direct or indirect foreign exchange consideration for the non-resident depositor .....

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ty of funds held in the NRE accounts in India and also agree for remittance of the funds from India, if necessary, for liquidation of the outstanding. ] (4) The authorised dealer/ bank should ensure that the advances are fully secured by the fixed deposits and regulations relating to normal margin, interest rate, etc. are complied with. (5) The loans granted under this paragraph shall be subject to such directions as may be issued by the Reserve Bank from time to time. (6) The term loan shall in .....

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ating intention to stay in India for an uncertain period. Where the account holder is only on a short visit to India, the account may continue to be treated as NRE account even during his stay in India. 8. Repatriation of funds to non-resident nominee: Authorised dealers/ authorised banks may allow remittance of funds lying in the NRE account of the deceased account holder to his non-resident nominee. 9. Miscellaneous: (a) Joint accounts - Joint accounts may be permitted to be opened in the foll .....

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may be opened in the name of an eligible NRI or PIO during his temporary visit to India against tender of foreign currency travellers cheques or foreign currency notes and coins tendered, provided the authorised dealer is satisfied that the person has not ceased to be a non-resident. c) Operations by Power of Attorney: Authorised dealers/ authorised banks may allow operations on an NRE account in terms of Power of Attorney or other authority granted in favour of a resident by the non-resident a .....

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eld in the account under any circumstances other than to the account holder himself, nor to make payment by way of gift to a resident on behalf of the account holder nor to transfer funds from the account to another NRE account. d) Special Series of Cheques: For easy identification and quicker processing of cheques drawn on NRE accounts, authorised dealers/ banks shall issue cheque books containing a special series of cheques to their constituents holding NRE accounts. e) Temporary overdrawings: .....

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