NRIs should know these rules before dealing in any kind of cash or investment

SIBY HERALD

Once you become an NRI sending and receiving money in India comes with a set of rules. Any transaction in or from India is controlled by FEMA. The Foreign Exchange Management Act (FEMA) came into effect in 1999 after the FERA act was revoked.

NRE account - For repatriable or moveable assets like securities and cash.

 FCNR (B) account - To store money in foreign currency. The NRO and NRE accounts are only used in Indian rupee.

NRIs are allowed to make unlimited investment in repatriable or non-repatriable transactions. The only exceptions are small saving schemes or PPF (Public Provident Fund) that aim to encourage small savings by giving good returns and tax benefits.


An NRI can send money back to India gained from foreign repatriable assets like rent received from a building owned abroad. There are more restrictions on immovable assets like property and lands because the NRI can only be repatriated on his originally invested foreign fund. They cannot profit from any ROI that proceeds from these investments.

You need to know these fundamental rules before dealing in any kind of cash or investment. Once you know them well, it becomes easier to do day to day transactions and long term investments.


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