An NRI may have assets and bank accounts overseas. The income earned from these assets would be in a foreign currency. A returning NRI has the option to bring the funds to India through opening a Resident Foreign Currency (RFC) account with an Indian bank.
The funds in an RFC account are kept in foreign currency and can be transferred to NRE/FCNR accounts if the individual returns overseas.
A Resident Foreign Currency account can be opened by a person ‘resident of India’ with foreign exchange received as retrial proceeds from employer abroad, or by converting any assets acquired while he was an NRI or inherited from or gifted by an individual resident outside India and repatriated to India.
An account can also be opened outside of the foreign exchange received by Indian resident as proceeds of LIC claims/maturity/surrendered amount settled in forex.
To open an RFC account with the authorized bank in India, an RFC account opening form must be filled. Funds can be brought from the above sources or funds in the NRE or FCNR accounts.
Self-attested photocopies of following documents need to be submitted by ex-NRIs together with the duly completed RFC account opening form:
- Current passport
- Expired work permit/work visa
- Current Indian proof of address from the permitted address proof documents
For a PIO, copies of the following documents may be required additionally:
- PIO or OCI card or
- Past Indian passport of a self/spouse/parent/grandparent along with a self-declaration about Indian origin or
- Self-declaration for PIO in the prescribed form.
- Indian work visa or residence visa
Point to remember
- A Resident Foreign Currency (RFC) account can be opened with a joint holder who is a resident Indian on a “former or survivor” basis.
- There is no limit to when an RFC account can be opened as long as the above criteria are met.