What is the difference between an Non-Resident External (NRE) and an Non-Resident Ordinary (NRO) account?



An Non-Resident Indian (NRI) can choose to open either an NRE or NRO savings bank account to invest in the Indian stock market. The trading and demat account must be opened based on the bank account type.
  • An NRE bank account is used for an NRI to park his foreign earnings in India.
  • An NRO bank account is used for an NRI to manage income earned in India.


Particulars
NRE Trading AccountNRO Trading Account
Purpose
For investments on repatriation basis
For investments on non-repatriation basis
Savings Bank Account Type
NRE (Portfolio Investment Scheme (PIS))/ NRE savings bank account
NRO savings bank account
Repatriation of Funds
Fully repatriable
The principal amount after taxation is repatriable. 
You can transfer up to 1 million USD in a financial year. Interest earned is also repatriable. 
TDS is deducted.
Intraday Trading
Not allowed
Not allowed
F&O Trading
Not allowed
Allowed
Commodity Trading
Not allowed
Not allowed
Joint Holders
Allowed
Allowed
TDS Applicability 
Yes
Yes 


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