Account Type for RNOR

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This discussion clarifies account opening options for individuals who are Resident but Not Ordinarily Resident (RNOR). While FEMA categorises individuals as either resident or non-resident, an RNOR can typically open a regular savings account. However, the eligibility criteria for NRO accounts, as outlined by banks like ICICI and SBI and RBI circulars, indicate that certain foreign nationals and specific categories of individuals, including those residing in India temporarily for employment or vocation, may be eligible for an NRO account. The thread also touches upon specific restrictions for citizens of Pakistan and Bangladesh.

Akshit Jain

Akshit Jain (Querist)
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26 October 2024 Would a RNOR (Resident but Not Ordinarily Resident) open a regular savings account or NRO account?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 October 2024 Yes, an RNOR (Resident but Not Ordinarily Resident) individual can open a regular savings account or an NRO (Non-Resident Ordinary) account.

Akshit Jain

Akshit Jain (Querist)
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26 October 2024 Thank you for kindly replying. Under FEMA there is no concept of RNOR - a person is either a resident or non-resident. Under FEMA, a resident can hold regular savings account, a non-resident can hold NRO/NRE account. Sir, what is the basis of your conclusion (please cite the rule) that an RNOR has the option of opening an NRO account?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 October 2024 Eligibility
You are eligible to open an NRO Account if you are at least 18 years of age and are:

OCI/NRI/PIO and their spouses, OR
Any foreign national, who is not a citizen of India, OR
An Indian sent abroad by the Government of India/Public sector undertaking.
Ref: https://www.icicibank.com/nri-banking/nri-account/nro-saving-account

Or https://sbi.co.in/web/nri/information/faqs

or https://www.rbi.org.in/Scripts/BS_ViewMasCirculardetails.aspx?id=7309#A2

Akshit Jain

Akshit Jain (Querist)
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26 October 2024 Thank you, sir. Can you please also confirm that Nepal or Bhutan based NRIs must hold regular resident accounts in India and not NRO accounts?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)
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26 October 2024 1. Individuals/ entities of Pakistan nationality/ origin and entities of Bangladesh origin require the prior approval of the Reserve Bank of India, to open NRO account. However, individuals of Bangladesh nationality can open an NRO account subject to the individual(s) holding a valid visa and valid residential permit issued by Foreigner Registration Office (FRO)/ Foreigner Regional Registration Office (FRRO) concerned.

2. Citizen of Bangladesh/Pakistan belonging to minority communities in those countries i.e. Hindus, Sikhs, Buddhists, Jains, Parsis and Christians residing in India and who has been granted LTV or whose application for LTV is under consideration, can open only one NRO account with an AD bank subject to the conditions mentioned in Notification No. FEMA 5(R)/2016-RB dated April 01, 2016, as updated from time to time. he opening of such NRO accounts will be subject to reporting of the details of the accounts opened by the concerned Authorized bank, to the Ministry of Home Affairs (MHA) on a quarterly basis as instructed vide AP (DIR Series) Circular No. 28 dated March 28, 2019.

3. When an individual residing in India leaves for a country (other than Nepal or Bhutan) for business or employment opportunities, to carry on a vocation outside India or for any other purpose which may require him to stay outside the country for an uncertain period, his existing savings account is designated as a Non- Resident (Ordinary) Account.

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