3 Best Bank to Open NRI Savings Account India - HDFC vs Kotak vs ICICI Bank

Recently I was doing some research to open an NRI Savings account in India, and given there are so many banks, both public and private sector are providing NRI services, I thought to do some quick checks on the best NRI savings account I can get this moment. One of my friends suggested I open your NRI Savings account in HDFC bank, the other suggested that he has an account in Kotak Mahindra and is very happy with their services, especially rather offered on their remittance service click2Remit.
My third friend suggested me to go for ICICI bank, a relatively safe bank but with better services and, more importantly, a better interest rate. Seems ICICI bank is offering the highest interest rate on NRI Savings accounts; they are offering rate of @ 7% p.a.* for balances more than Rs. 1 lakh & 6% p.a. for balances up to Rs. 1 lakh, compared to 4% per annum from both Kotak and HDFC. 

The good thing is that interest for all rupee savings accounts will be calculated on the daily closing balances maintained in the account, which is true for all three banks.

So by chance, if you keep more than 1 lakh in your NRI savings account, ICICI Bank is the best one for you. You can get a much higher interest rate compared to Kotak Mahindra or HDFC. Apart from this deciding factor, let's see a couple of other unique features provided by the NRI savings account of these three Major banks.

What is NRI Savings Account

There are two kinds of NRI savings accounts, NRE (Non Resident External) and NRO (Not resident Ordinary). There is a lot of differences between NRE and NRO accounts, and you need to decide which account you want to open, depending on the money you are going to put in. For example, NRE Savings Account lets you conveniently transfer your earnings to India with complete security.

You can repatriate the funds held in the account along with interest earned at any point in time and you don't even have to pay tax on the interest amount. On the other hand, NRO Savings account will allow you to keep your Indian earnings from rent, fixed deposit interest, dividends and other sources. Money keep in NRO accounts are not tax-free; see here to learn more about the benefits of NRO accounts here.

But, both of these allow you to stay in complete control of your hard-earned income abroad. This article will compare NRE Savings accounts from Kotak Mahindra, HDFC, and ICICI Bank in India. Just to be informed, all are private banks, and I like them because of their services and support. Just to keep in mind, all NRE bank account has the following features.

1. Money is kept in rupees, so when you transfer money from abroad, it's converted into rupees at the prevailing exchange rate; that's why it's better to transfer money when you are getting higher rates, rather than transferring small amounts regular basis.
   
2. You can only fund your NRE saving account from foreign currency, which means you cannot deposit rupee directly into NRE saving account.
3. Funds held in this account and interest thereof is fully repatriable, which means you transfer it bank to abroad without any hassle.
4. NRE Savings Accounts are exempted from tax in India, so both money kept in account and interest earned are tax-free.
5. Most of the banks provides international debit card and internet banking facility for NRE savings account.
6. Most of the banks provide our online bill payments facility to Pay your bills online anytime at your convenience. This is very useful if you are paying telephone and electricity bills of your parents staying in India. Online convenience is big plus.
7. Interest earned on NRE savings account is also exempted from wealth tax. 
8. You can transfer fund from your NRE account to other resident saving account or NRO accounts.
9. Most banks allow you to open NRE, NRO fixed deposits and FCNR fixed deposit from your money kept in your NRE saving account. If you have access to net-banking and online account then this process is fully accessible. It takes usually two to three days to open your NRE fixed deposits. 

What are the 3 Best Banks to Open NRE/NRO Savings Accounts?

Here is  my list of 3 best banks to open NRE/NRO Savings accounts in India:

1. HDFC bank NRE Savings Account

HDFC is one of the reputed Indian banks, after ICICI and SBI, and their services and support are good quality. Unfortunately, HDFC bank doesn't offer interest rates compared to ICICI bank, but it offers some good features, and given its accessibility, you can also consider opening an NRE account in this bank. HDFC has a very good online banking site, and their customer support is also great. 

More importantly, HDFC banks have more branches than Kotak and ICICI Bank, and it's more likely that you have a branch of HDFC bank in your city than ICICI Bank or Kotak Mahindra bank. 

Since nowadays every branch of the same bank is connected via intra-bank networking, you can go to any branch, and more often than not you can perform transactions, check balance, update address, telephone or mobile number, add nominations and can do several other tasks. 

Of course, you can do most of them online and some offline by downloading the form and couriering to the respective branch, sometimes, it's quick to visit a branch. This accessibility is actually main reason why someone wants to open their NRE account on banks like HDFC, ICICI and SBI bank.

• HDFC banks allow you to Invest in Mutual Funds by linking your NRE Savings Account to Investment Savings Account.
• HDFC bank assigns personal relationship managers, Kotak also does the same. Time and time their relationship manager will give you call and explain new features and products. They will also suggest you invest in Stocks, given current Modi wave and huge interest by FII in India. You can discuss them your investments plans and they can help you on that as well. 
• HDFC bank allows you to transfer your funds freely to any place outside India (other banks also do).
• HDFC bank gives you an international debit card along with your NRE savings account, which you can use to do shopping worldwide.
• Another good feature of HDFC bank account is that it allows you Appoint a mandate to operate your account on behalf of you. A mandate is an authorization given to a person to operate your account. You can give mandate to your father, mother, brother, sister or anyone who you can trust for your financial matters. 
• You can directly remit the amount to HDFC bank from your overseas bank account, or you can use remittance services like money2India to transfer fund to your NRE savings account.
• HDFC bank provides a sweep-in facility, which allows you to link NRE Fixed Deposit to NRE Savings Account to take care of deficits if any without losing out on the interest.
• Average quarterly balance in HDFC bank is 10,000 for urban banks and 5,000 for non-urban.

Kotak Mahindra NRE Saving Account

Kotak is another private bank growing fast in India and concentrating on a lucrative market. They have a simple process to open an NRE saving account and assign a personal relationship manager to help you with remittance and investment. 

They also have their own remittance service called click2Remit, which provides very good rates if you let them know that you are transferring money of more than USD 10,000 or same. Here are some of the more useful features of the Kotak NRE savings account :

• 2 Way Sweep provides a dual opportunity to earn higher interest and manage cash flow at the same time.
• Kotak bank provides Easy and Economical Remittances into India by Cheque or Wire Transfer or Click2Remit.
• Preferential exchange rate for transaction above USD 10,000/- or equivalent.
• Kotak bank also gives you Global Debit Card when you open NRE account with them. This allows access to your bank account any-time, anywhere on all VISA ATMs and at merchant locations both in India and abroad. You can withdraw dollars from this account in any VISA enabled ATM in the world e.g USA, UK or anywhere else.
• Kotak bank's relationship manager provides personalized investment advisory customized to risk return.
• Low Average Quarterly Balance of Rs. 10,000/- only.
• You can also transfer money from your Kotak NRE account to any other NRO accounts, or any other bank resident saving account. 

ICICI Bank NRE Savings Account

ICICI Bank is a relatively safe bank in India but has a strong presence among NRIs. I have a couple of friends who have both NRE and NRO savings accounts with ICICI bank, and they are very happy with the services and support. 

Here are the main features of the NRE Savings account from ICICI bank

• Personalized cheque books
• Mandate facility for your loved ones in India with a Domestic Debit card to access your account while you are away.
• Easy account funding through our alliances with correspondent banks worldwide
• NRO & NRE Savings account balances are grouped allowing you the flexibility to maintain balances in either of the accounts, but the grouping facility is solely for the purpose of calculation of Average Quarterly Balance; all other product features remain the same as per product variant. This means, if you have both NRE and NRO savings accounts in ICICI  bank, you don't need to worry about the average quarterly balance in each account. The combined sum of both accounts can be used to maintain the average quarterly balance. 
• ICICI bank allows an enhanced spending limit and cash withdrawal limit depending on the account variant.
• ICICI bank's inter-city banking facility allows you to bank at any of our branches during your visit to India. This is really convenient because if you hometown doesn't have an ICICI bank branch, you can visit them on your transit stay at any metro e.g. Mumbai or Chennai.

So apart from couple of features more or NRE savings account from HDFC, ICICI Bank and Kotak is same. For me interest rate and customer support is foremost important and ICICI bank score well on them. HDFC is not bad either because of their wide range. You can open NRE fixed deposit, can invest in mutual funds using your NRE savings account, which is great. 

Kotak has excellent remittance services and they provide Preferential Forex rate for transaction above USD 10,000/- or equivalent, which can be crucial and equal to interest earned in a quarter. In short, ICICI bank NRE account is best for interest rate point of view, Kotak NRE account is based upon exchange rate point of view and HDFC bank NRE account is best upon an investment point of view.

Other NRI  Articles You may like to read

• Is it mandatory to file income tax returns for NRIs?
• 3 Income tax benefits of opening NRI accounts in India
• How much is the minimum account balance in the NRI account?
• 10 Income tax deductions and exemptions NRIs should know
• How NRIs can file their income tax returns online
• 13 ways to save income tax in India
• 5 Tax Saving options not available to NRIs
• Is NRI's overseas income taxable in India
• How much TDS is deducted from the NRO account?
• Is it mandatory for NRIs to declare foreign bank accounts on tax returns?
• How to determine the tax residential status of NRIs?
• 10 points NRIs should know about Income tax?
• Is Aadhaar card Mandatory for filing an Income tax return for NRIs?

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