Resident Foreign Currency accounts (RFC)
1. What is a Resident Foreign Currency (RFC) Account Scheme?
Under this Scheme, persons of Indian nationality or origin, who have returned to India for permanent settlement (Returning Indians), can open foreign currency accounts with banks in India for holding funds brought by them to India.
2. What are the types of accounts that can be opened under the scheme?
All types of accounts namely, current, savings (without cheque book facility), and term deposits can be opened under the scheme.
3. Can the funds in NRE/FCNR accounts be credited to RFC account?
The returning NRI can credit the balances in NRE, FCNR accounts to RFC accounts.
4. Can RFC accounts be opened jointly?
Resident individuals (who are eligible to open RFC accounts) may now include non-resident Indian close relatives as joint account holder in their RFC account on ‘Former or Survivor’ basis. Such non-resident Indian relative cannot operate the account during the life time of the resident account holder.
5. In what currencies are RFC accounts denominated?
RFC accounts can be opened in USD, GBP EURO and JPY currencies.
6. What are the permissible credits to RFC account?
Pension or other monetary benefits from previous employment outside India.
Proceeds of foreign assets including foreign security or immovable property situated outside India if such security or property was acquired or owned by the NRI when he was resident outside India.
Received or acquired as gift or inheritance from a person resident outside India and proceeds have been repatriated to India.
Balances in any NRE/FCNR account. No penalty would be levied for premature withdrawal of NRE/FCNR deposits in such cases.
Rupee balances in eligible NRE accounts by converting into foreign currency.
7. Can funds in RFC accounts be remitted abroad?
Funds in RFC accounts can be remitted abroad for any bonafide purpose of the account holder or his dependents including exchange required for travel and other personal purposes and investments.
8. Can the funds in RFC accounts be used for making local payments?
Funds in RFC account can be withdrawn freely for local payment in rupees.
9. Can the balance in RFC account be credited to NRE/FCNR in event of account holder becoming NRI again?
Funds held in RFC account may be freely remitted abroad or credited to NRE/FCNR account in the event of account holder becoming Non-Resident again.