Friday, May 27, 2016

Can NRI deposit INR in NRE Account in India

The answer is both Yes and No, it depends on upon the source of funds. Technically, Yes, you can deposit INR or Indian rupees in NRE account in India with both private banks e.g. HDFC, ICICI, Kotak, YesBank, Federal Bank, and any public sector banks like SBI, Bank of Baroda, Bank of India etc, provided the source of INR is another NRE or FCNR account. So, if your friends, relative or wife has an NRE saving account and they can legally transfer Indian Rupees to you.

Similarly, if you have more than one NRE account let's say one NRE account with SBI and other NRE saving account with HDFC than also you can deposit INR from SBI NRE to HDFC NRE account. Both are perfectly legal, though you have to be careful when you ask friends to deposit money because that would be considered a gift and you may need to pay income tax on that.

Asking wife or parents to transfer money to NRE account should be fine because they are immediate family members. Also, NRI can open more than one NRE account with different banks in India.

NRE accounts are somewhat restricted in terms of permissible credits. These accounts are opened in Indian rupees and all foreign exchange deposits received for credit of these accounts are first converted to Indian rupees at the bank's buying rate. You can see this list of all the permissible way to deposit money into NRE account.

Can NRI deposit Indian Rupees in NRE Saving Account

On the other hand, you cannot deposit INR to your NRE account from any other source e.g. you cannot transfer money from your friends or wife's resident saving account to your NRE account. Since the source of those funds is not overseas they are not eligible to deposit on NRE account which allows free repatriation of funds i.e. you can online transfer money from your SBI NRE account to USA, Canada, UK, Singapore or any other country.

Even If you have a resident saving account with the same bank, you cannot transfer money from resident saving account to NRE. In fact, you need to first ask your bank to convert your resident saving account to NRO account before opening an NRE account.

One exception to rule is that you can transfer INR from NRO saving account or fixed deposit to NRE account but that is subject to a limit of 1 million USD per year. You also need to take a written approval and pay taxes in advance before transferring Indian rupees from NRO to NRE saving the account. See this article to learn more about how to transfer money from NRO account to NRE account in India.

Can NRI deposit INR on NRE saving account

Now, the questions come what if you have sold a property and got a big amount of money on Indian rupees, where should you deposit that? Well, NRO accounts are for just these purpose. You can deposit rental income, royalty income, income from selling properties etc into NRO account. Once you got the money in NRO account you can start the procedure for transferring INR to your NRE account.

That's all about whether you can deposit INR into your NRE account in India or not. As I said, it's perfectly ok to deposit money in your NRE account from India be it SBI NRE account or HDFC NRE account. The only thing which is important is the source of funds. You can only deposit INR which is from other NRE accounts or NRO accounts. You cannot deposit INR from resident saving account to your NRE account.

Just remember, once your income tax status changes to NRI, you cannot keep your resident saving account or resident fixed deposit. You need to convert them to NRO saving account and fixed deposit as early as possible. 


  1. Thank you for sharing such great information. It is informative, can you help me in finding out more detail on Best Tax Saving Plan , i am interested and would like to know more about this field and wanted to understand the basics of Best Tax Saving Plans

  2. I am non-resident and I still have the normal savings account and fixed deposits in India. Is that illegal ?

  3. I am non-resident and I still have the normal savings account and fixed deposits in India. Is that illegal ?

  4. There are list of blogs available online on NRE accounts in India. But this one is complete guide to me. This resolved all my queries related NRE Saving account. I will definietely share this blog link with my friends who wants to send money to India. Thank you for sharing this informative blog with us. Keep up the good work Javin.

  5. Thanks a lot for this blog. You are doing an awesome job.. Have got these following questions.. 1) How can somebody/blood relatives send money abroad from India? 2) Can you transfer money from your NRE/NRO account to your blood relatives' account? 3) What is the procedure to repatriate money from NRE accounts?4 ) Can you transfer money from FCNR to NRE/NRO/ savings accounts of blood relatives?