What changed
Previously, NRIs/PIOs were barred from opening NRE/FCNR(B) accounts jointly with any resident. Following a committee recommendation, RBI has now allowed joint accounts with resident close relatives (as defined under Section 6 of the Companies Act, 1956) on a 'former or survivor' basis. The resident close relative can also operate the account as a Power of Attorney holder during the NRI's lifetime.
What it means for you
Banks can now offer NRE/FCNR(B) joint account facilities to NRIs with their resident close relatives, expanding product appeal and easing remittance management. This liberalization simplifies succession planning and account operations for NRI families. AD banks must update their internal procedures and customer communication to reflect this change.
What you must do
- Update account opening forms and system rules to allow joint NRE/FCNR(B) accounts with resident close relatives on 'former or survivor' basis.
- Train staff on the new eligibility criteria and Power of Attorney operational guidelines for resident close relatives.
- Notify existing NRE/FCNR(B) account holders about the new facility through circulars or branch communication.
- Ensure compliance with FEMA regulations and verify the 'close relative' definition as per Section 6 of the Companies Act, 1956.
Who it affects
Authorised Dealer (AD) banks, Non-Resident Indians (NRIs), Persons of Indian Origin (PIOs), Resident close relatives of NRIs/PIOs
Does this circular apply to existing NRE/FCNR(B) accounts?
The circular permits opening new joint accounts with resident close relatives. It does not explicitly address restructuring of existing accounts; banks should refer to FEMA regulations and operational guidelines for any modifications.