What types of rupee accounts are permitted for NRIs investing in Indian mutual funds?

Mutual Fund FAQs
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Account Type Key Features Best For
NRE (Non-Resident External)
  • Held in Indian Rupees
  • Funded with overseas earnings sent to India
  • Both principal and interest are fully repatriable (can be sent abroad anytime)
 NRIs who want to invest overseas earnings in India with the option to move money back freely
NRO (Non-Resident Ordinary)
  • Held in Indian Rupees
  • Used for income earned in India (rent, pension, salary, dividends)
  • Interest is freely repatriable
  • Principal can be repatriated up to USD 1 million per year (as per RBI rules)
 NRIs with income sources in India who want to invest or spend locally
FCNR (Foreign Currency Non-Resident)
  • Fixed deposit account held in foreign currency (USD, GBP, EUR, etc.)
  • Principal and interest are fully repatriable
  • Protected from currency risk (rupee depreciation doesn’t affect deposit value)
 NRIs who prefer stable returns in foreign currency without rupee risk

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