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NRE full form meaning & significance

NRE Full Form 

Non Resident External Account  is an account of an NRI to transfer foreign earnings to India

NRE Account

The NRE account is an Indian rupee-denominated account, offering complete security. These accounts can be in the form of savings, current, recurring, or fixed deposits. The foreign currency you deposit into the account is converted to INR. You can transfer your funds (Principal & Interest amount) to a foreign account from an NRE account without any complications and restrictions. You need to note that the amount you deposit into these accounts must be earned outside India. The international debit card enables you to transact and withdraw money 24*7. Also, mutual fund investments become effortless and instant if you link your NRE account number to the investment account. NRE account is primarily used for carrying out business, personal banking and making investments in India.

Why do you need a Separate Account?

Following the Foreign Exchange Management Act (FEMA) guidelines, the Reserve Bank of India allows an NRI to open two types of savings bank accounts with authorized dealers and banks: A Non-Resident External (NRE) Rupee account and a Non-Resident Ordinary Rupee (NRO) Account.

The RBI states that an NRE account should be opened by NRIs themselves1. It does not permit the holder of a power of attorney to open these accounts. So, if you don’t already have one, make sure you open one on your next visit.

Depositing and withdrawing money 

Apart from remittances to India, the account allows you to make foreign currency deposits during your visit to India. It permits you to transfer from another NRE or Foreign Currency Non-Resident (FCNR) bank account. Personal cheques, travelers’ cheques and bank drafts drawn in any foreign currency can be deposited by you in person. However, banks have to be provided with proper documentation to prove that you are an NRI.

Interest earned on the funds in your account, proceeds from the sale of FDI investments, interest and dividends from other assets can be seamlessly credited to an NRE account.

You can also withdraw money from this account for local disbursements, remittances outside India, investment in shares, purchase of immovable properties or transfer to other NRE/ FCNR accounts.

Joint Acc. 

Two or more Non-Resident Indians can open a joint NRE account as long as all account holders are persons of Indian origin or nationality. If one of the joint account holders becomes a resident Indian, then the banks have the option to delete his/her name and allow the account to continue as an NRE account. Another option is to convert the account into a resident Indian account by removing the NRI holder’s name.

Please note that an NRI has an option to open an NRE account jointly with a resident Indian only in former or survivor mode of operation

Final Note

If your total income includes income earned in India and you want to manage it within the country, you can opt for an NRO account. An NRE account can be opened if you want to transfer your foreign income to India and want to avoid taxation liabilities. They are both a variation of savings accounts.

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The Reserve Bank of India does not accept any responsibility for the correctness of any of the statements or representations made or opinions expressed by Innofin Solutions Private Limited, and does not provide any assurance for repayment of the loans lent through its platform.

LenDenClub is an Intermediary under the provisions of the Information Technology Act, 2000 and virtually connects lenders and borrowers through its electronic platform via the website and/or mobile app.

The lending transaction is purely between lenders and borrowers at their own discretion, and LenDenClub does not assure loan fulfilment and/or investment returns. Also, the information provided on the platform is verified or checked on the best efforts basis without guaranteeing any accuracy of the data/information verification. Any investment decision taken by a lender on the basis of this information is at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower, fully or partially. The risk is entirely on the lender. LenDenClub will not be responsible for the full or partial loss of the principal and/or interest of lenders’ investment amounts.


*P2P investment is subject to risks. And investment decisions taken by a lender on the basis of this information are at the discretion of the lender, and LenDenClub does not guarantee that the loan amount will be recovered from the borrower.

** Average value mentioned is the weighted average of returns received by investors

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