Types of Bank Account a Foreign Director can hold in India

There are two types of Rupee denominated accounts that a foreign citizen or entity may open with a bank in India and they are Ordinary Non-Resident Rupee (NRO) Accounts & Non-Resident (External) Rupee Accounts (NRE Accounts). The latter is limited to Indian Nationals only. Balances in NRO accounts are eligible for remittance abroad subject to some restrictions and limits.

A Foreign Director can also hold Foreign Currency Accounts in India. For a Non-Resident Indian or persons of Indian origin are allowed to open foreign currency accounts with banks in India Foreign Currency (Non-Resident) Accounts (Banks) Scheme - [FCNR(B)]  and Resident Foreign Currency (RFC) Accounts Schemes.

In order to meet the local expenses in connection with the projects in India, an overseas company can open foreign currency accounts with banks in India if they are executing projects in India.

It is recommended for a foreign national to use the services of a legal professional or local business associate before doing business in India, as their Directorship, Investment should conform to Rules and Acts and FDI guidelines.


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