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What is an SNRR account? How is it different from a NRO account?

Who can open?

SNRR Account

Any person resident outside India, having a business interest in India for putting through bona fide transactions in rupees.

Opening of SNRR accounts by Pakistan and Bangladesh nationals and entities incorporated in Pakistan and Bangladesh requires prior approval of Reserve Bank.

NRO Account

Any person resident outside India for putting through bonafide transactions in rupees.

Individuals/ entities of Pakistan nationality/ origin and entities of Bangladesh origin require the prior approval of the Reserve Bank of India.

However, a citizen of Bangladesh/Pakistan belonging to minority communities in those countries i.e. Hindus, Sikhs, Buddhists, Jains, Parsis and Christians residing in India and who has been granted LTV or whose application for LTV is under consideration, can open one NRO account with an AD bank subject to the conditions mentioned in Notification No. FEMA 5(R)/2016-RB dated April 01, 2016, as updated from time to time.

Type of Account?

SNRR Account in Non-interest bearing

NRO Account in Current, Savings, Recurring or Fixed Deposit; Rate of interest – as per guidelines issued by Department of Regulation.

Permissible Transactions?

SNRR Account - Debits and credits specific/ incidental to the business proposed to be done by the account holder

NRO Account

Credits:

Inward remittances, legitimate dues in India, transfers from other NRO accounts and any amount received in accordance with the Rules/Regulations/Directions under FEMA, 1999.

Debits:

Local payments, transfer to other NRO accounts, remittance of current income, settlement of charges on International Credit Cards.

Tenure?

SNRR Account - Concurrent to the tenure of the contract / period of operation / the business of the account holder and in no case should exceed seven years, other than with approval of the Reserve Bank.

Restriction of seven years is not applicable to SNRR accounts opened for the purposes stated at sub. paragraphs i to v of paragraph 1 of Schedule 4 of FEMA 5(R).

NRO Account - No such restrictions on tenure.

Repatriability?

SNRR Account - Repatriable

NRO Account - Not repatriable except for current income; and remittances by NRIs/ PIOs up to USD 1 million per financial year in accordance with the provisions of FEMA 13(R).

What is an SNRR account? How is it different from a NRO account?

Who can open?

SNRR Account

Any person resident outside India, having a business interest in India for putting through bona fide transactions in rupees.

Opening of SNRR accounts by Pakistan and Bangladesh nationals and entities incorporated in Pakistan and Bangladesh requires prior approval of Reserve Bank.

NRO Account

Any person resident outside India for putting through bonafide transactions in rupees.

Individuals/ entities of Pakistan nationality/ origin and entities of Bangladesh origin require the prior approval of the Reserve Bank of India.

However, a citizen of Bangladesh/Pakistan belonging to minority communities in those countries i.e. Hindus, Sikhs, Buddhists, Jains, Parsis and Christians residing in India and who has been granted LTV or whose application for LTV is under consideration, can open one NRO account with an AD bank subject to the conditions mentioned in Notification No. FEMA 5(R)/2016-RB dated April 01, 2016, as updated from time to time.

Type of Account?

SNRR Account in Non-interest bearing

NRO Account in Current, Savings, Recurring or Fixed Deposit; Rate of interest – as per guidelines issued by Department of Regulation.

Permissible Transactions?

SNRR Account - Debits and credits specific/ incidental to the business proposed to be done by the account holder

NRO Account

Credits:

Inward remittances, legitimate dues in India, transfers from other NRO accounts and any amount received in accordance with the Rules/Regulations/Directions under FEMA, 1999.

Debits:

Local payments, transfer to other NRO accounts, remittance of current income, settlement of charges on International Credit Cards.

Tenure?

SNRR Account - Concurrent to the tenure of the contract / period of operation / the business of the account holder and in no case should exceed seven years, other than with approval of the Reserve Bank.

Restriction of seven years is not applicable to SNRR accounts opened for the purposes stated at sub. paragraphs i to v of paragraph 1 of Schedule 4 of FEMA 5(R).

NRO Account - No such restrictions on tenure.

Repatriability?

SNRR Account - Repatriable

NRO Account - Not repatriable except for current income; and remittances by NRIs/ PIOs up to USD 1 million per financial year in accordance with the provisions of FEMA 13(R).