How to convert existing Resident Saving account to NRO Account in India?

When a Resident Indian becomes an NRI he needs to convert his Resident saving account to NRO account as per Indian banking and income tax laws e.g. FEMA. The NRO account provides the simplest way to access and operate the money and investments already made in India. These accounts can receive foreign remittances, can have a joint account holder who is a resident India e.g. your mother or father, and RBI also permits repatriations from NRO account to abroad limited by a maximum annual amount.



NRI Residential Status

In order to convert your existing resident saving account to NRO account in India, you need to inform your bank about your NRI status. You must provide a documentary proof that the account holder is now a non-residents India as defined in the Indian tax laws.

Once a person becomes an NRI, he cannot continue to hold bank accounts with resident India status.

Documents
In order to convert existing resident bank account into a non-resident ordinary account you need to submit following documents to your bank:
i) Identity proof e.g. Passport, Driving License, Voter ID card, or Aadhar Card
ii) NRI status proof e.g. green card or copy of your VISA
iii) Proof of foreign address e.g. utility bills or telco bills or foreign bank statements
iv) Recent photographs, not older than 3 months.


The account holder or applicant must provide proof of overseas resident in the form of employment details, student status, dependent visa status, or a copy of the resident permit in the country he is currently living. This proof has to be attested by the Indian embassy, notary, or an Indian bank with an overseas branch, but this is optional, many banks accept the self-attested copy of documents.

If you also want to include your local Indian address for ease of operation in addition to an overseas address, you need to submit another local address proof with attestations.


Why you need NRO account?

How to convert existing Resident Saving account to NRO Account in India


An NRI can hold three types of bank account in India e.g. NRE, NRO, and FCNR. Out of these three, FCNR, which stands for Foreign Currency, Non Resident is a foreign currency account which can only be open as fixed deposit with Indian banks. You cannot open an FCNR saving account.

This means for all your day-to-day need, you can either have an NRE saving account or an NRO saving account. Since you cannot deposit INR into NRE account, you must need an NRO account to deposit income you are receiving in NRO e.g. rental incomes, dividends received from your existing investment in Stock Market and just to receive INR from any friend or family.

In short, here are main reasons to open NRO account:
i) To receive any income on Indian rupees e.g. rental income or dividends
ii) In order to deposit INR as NRE account can only be funded using foreign currency or remittance
iii) to receive sale proceeds a property in India

That's all about how to convert an existing resident saving bank account to NRO account in India. Remember, it's mandatory for an NRI to convert his resident Indian bank account to NRO account by law. The NRO account also allows you to deposit Indian rupees into your bank account because you cannot deposit INR into NRE account.

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