Q.1 NRls can be Joint Holders in Resident's SB/EEFC/RFC Accounts
Individual residents in India are now permitted to include non-resident close relative(s) as joint holder(s) in their resident bank accounts as also in Exporter Earners' Foreign Currency (EEFC) and Residents' Foreign Currency (RFC) accounts on 'former or survivor' basis. Non-resident Indian close relative(s), however, would not be eligible to operate the account during the life time of the resident account holder.
Q.2 Residents can be Joint Holders in NRE/FCNR Accounts
Non-Resident Indians(NRls), are now permitted to open Non-Resident (External) Rupee Account Scheme/Foreign Currency (Non-Resident) Account (Banks) Scheme (B) accounts with their resident close relative(s) on 'former or survivor' basis. The resident close relative would be eligible to operate the account as Power of Attorney holder in accordance with existing instructions during the life time of the Non-Resident Indian/ Persons Indian Origin account holder.
Q.3 Residents can gift Shares/Debentures up to USD 50,000 Value
A person resident in India can now give to a person resident outside India, by way of gift, any security/shares/ debentures of up to USD 50,000 in value per financial year without approval of the Reserve Bank of India. Earlier, a person resident in India could give to a person resident outside India, by way of gift, any security/shares/debentures of up to USD 25,000.
Q.4 Sale Proceeds of FDls can be credited to NRE/FCNR (B) Account
Sale proceeds of Foreign Direct Investment (FDI) are now permitted to be credited to Non-Resident (External) Rupee (NRE) Account Scheme/Foreign Currency (Non-Resident) Account FCNR (Banks) Scheme (B) accounts. The Nonresident Indians/Persons of Indian Origin should, however, have purchased the consideration out of inward remittance or funds held in their NRE/FCNR (B) accounts. Earlier, the facility was allowed only for investments in India. Further, the facility is available subject to applicable taxes.
Q.5 Gifts to NRls can be credited to NRO Accounts in Rupees
Resident individuals are now permitted to make a rupee gift to a NRI/PIO who is a close relative by way of crossed cheque/electronic transfer to the Non-Resident (Ordinary) Rupee Account (NRO) of the NRI/PIO. The gift amount would have to be within the overall limit of USD 200,000 per financial year as permitted under the Liberalized Remittance Scheme (LRS) for a resident individual. It would be the responsibility of the resident donor to ensure that the gift amount being remitted is under the LRS and all the remittances under the LRS during the financial year including the gift amount do not exceed the limit prescribed.
Q.6 Loans to NRI Close Relatives can be given in Rupees
Resident individuals are now permitted to lend to a Non Resident Indian (NRI)/ Person of Indian Origin (PIO) close relative by way of crossed cheque/electronic transfer, subject to the following conditions:
- The loan should be free of interest and the minimum maturity of the loan should be one year;
- The loan amount should be within the overall limit under the Liberalized Remittance Scheme of USD 200,000 per financial year available for a resident individual. It would be the responsibility of the lender to ensure that the amount of loan is within the Liberalized Remittance Scheme limit of ,USD 200,000 during the financial year.
- The loan would have to be utilized for meeting the borrower's personal requirements or for his own business purposes in India.
- The loan should not be utilized, either singly or in association with other person, for any of the activities in which investment by persons resident outside India is prohibited, namely,
- The business of chit fund, or
- Nidhi Company, or
- Agricultural or plantation activities or in real estate business (excluding development of townships, construction of residential / commercial premises, roads or bridges) or construction of farm houses, or
- Trading in Transferable Development Rights (TDRs).
- The loan amount would have to be credited to the NRO account of the NRI/PIO;
- The loan amount should not be remitted outside India; and
- The loan should be repaid by way of inward remittances through normal banking channels or by debit to the Non-resident Ordinary (NRO) / Non-resident External (NRE) f-Foreign Currency. Non-resident (FCNR) account of the borrower or out of the sale proceeds of the shares or securities or immovable property against which such loan was granted.
Q.7 Loans given to NRI Close Relatives can be repaid
Resident individuals are now granted general permission to repay loans availed of from banks in Rupees in India by their NRI close relatives. Loans would have to be repaid by resident, close relative of the Non-Resident Indian by crediting the borrower's loan account through the bank account of such relative. Earlier, repayment of loans by close relative in respect of Rupee loan availed by NRls was restricted only to housing loans.
Q.8 Residents can bear Medical Expenses of NRls
Residents will now be allowed to bear the medical expenses of visiting NRls/PIOs close relatives. Earlier, residents were allowed to make payment in rupees towards meeting expenses on account of boarding, lodging and services related to it or travel to and from and within India of a person resident outside India and who is on a visit to India.