Unlike regular citizens of India, NRIs cannot have standard savings accounts in Indian banks.
There are three popular type of bank accounts an NRI could operate i.e. non-resident ordinary account, non-resident external account and foreign currency non-resident (B) account.
This is the savings bank account of the NRI, which can be funded in rupees or foreign exchange. For those moving abroad, after having worked in India, their resident savings account ought to be converted to an NRO account. This account can also have recurring or fixed deposits
The key difference from the NRO account is that this account needs to be funded only in foreign currency. The recurring and fixed deposit must have a minimum maturity period of one year. Power of attorney cannot be used to open an NRE account; the NRI account holder has to open this account on his own.
An FCNR (B) account is similar to opening a regular fixed deposit. You may close an FCNR (B) account prematurely; however, in order to earn any interest on the amount, the deposit must stay untouched with the bank for at least one year. Certain banks also offer a combination of NRE and NRO accounts for a more flexibility and convenience.
Property related loans are typically provided to salaried or self-employed professionals living abroad. In case of salaried professionals, the applicant must be employed in the same company for at least one year. You must provide proof of income to the bank while applying for loans
Self-employed professionals must provide continuity of business proof. Banks require at least 3 years of business vintage before providing loans for self-employed NRIs. Some banks waive this requirement if the applicant has real-estate properties in India
Most banks have also outlined specific income criteria for applicants to get a personal loan. This requirement is likely to differ for NRI applicants based on the country in which they are employed
Banks also require a local co-applicant before they can provide a loan. This co-applicant must be a close relative of the applicant. This co-applicant can either be an earning individual or a non-earning individual
Note: Identity and address proof documents must be submitted for the applicant as well as the co-applicant.
Home loans can be availed for any property ready for possession or under construction, construction of property on an owned plot or for alterations to the existing property. Buying of a plot also qualifies for a home loan.
The repayment of these loans can only be through Non-resident External (NRE) or Non-resident Ordinary (NRO) accounts with remittance from abroad. No other funds can be used for repayment of these loans. The repayment needs to be made in Indian Rupees only.
Income and educational qualifications play an important role in deciding the maximum amount of loan available to an NRI. Banks allow an advance of 80-85% of the value of the property, subject to the Gross Monthly Income (GMI) of an individual. Maximum amount of loan granted, is in the range of 36-40 times GMI. Some banks also go by the ratio of Equated Monthly Instalment to Net Monthly Income (EMI/NMI).
The repayment of these loans can only be through Non-resident External (NRE) or Non-resident Ordinary (NRO) accounts with remittance from abroad.
No other funds can be used for repayment of these loans. The repayment needs to be made in Indian Rupees only.
| Resident | NRI | |
| Properties eligible | New or old flats, construction on owned plots, buying of plots or alteration to existing property | Same as Residents |
| Maximum amount of loan | Up to 80% of value of properties costing more than Rs. 20L and 90% for less than Rs. 20L again depending on income | 80-85% of the value of property depending on income, place of residence etc. |
| Tenure of Loan | Up to 30 years with certain banks | 5-20 years |
| Rate of Interest | Depending on the base rate of the banks | Higher than Resident home loans |
| Repayment | Through normal account | Only through NRE/NRO account with remittance from abroad |
Lenders do not have any restrictions on how the personal loan amount is spent. Borrowers are not required to provide any bills or receipt to the bank to validate their expenses.
NRIs can get the personal loan amount from the bank in their NRE or NRO accounts. Most lenders provide the loan amount in Indian rupees. However, some banks also provide these loans in foreign currency. You may check the lender to know about the mode in which the loan amount is disbursed.
The conditions vary from one lender to another. This is typically based on the income level of the applicant. While taking a new loan, the applicant must provide information about his/her existing loans. It is necessary for the applicant to have a certain percentage of disposable income after paying all the monthly EMI installments. If this condition is satisfied, the applicant can avail a new loan even with an existing loan.
Online application facility is available for personal loans. However, NRIs might check with the bank about the process before making the application online. You may contact the customer service centre and ask them to guide you with the process.
As per the terms and conditions of most banks, the co-applicant for personal loans must be a close relative. Hence, many banks do not accept friends as co-applicants for personal loans. However, you may check with the bank to know whether this option is available.
