Many Indian students live abroad or plan to go outside India for further education. During this time, they need a bank account to manage their finances effectively. Since students living abroad for a specific number of days are considered NRIs or Non-Resident Indians, they cannot hold regular savings account in India. Such NRI students need to use an NRI bank account like an NRE or an NRO account. Many banks offer services for a student NRE account that aims to help students studying abroad in managing their finances.
Students living abroad have unique banking requirements. Most of them will have family living back home in India, and they need to maintain financial relations with a bank account in India. A student NRE account works to this effect. Let us understand everything there is to know about a student NRE account.
What is a Student NRE Account?
A student NRE account is a type of savings account specifically aimed at Indian students living abroad. It helps Indian students effectively manage their finances with greater ease and convenience when they’re living abroad.
Why Choose a Student NRE Account?
If you’re a student living abroad, do you really need a student account? A student NRE account can really help you manage your finances when you’re outside India, and you also cannot hold a regular savings account. A student NRE account allows you to deposit in foreign currency, which is converted into INR, and the account is maintained in INR. Additionally, the minimum balance for such accounts is usually as low as INR 5,000. These benefits make a student NRE account a must-have account for student NRIs.
Features of Student NRE Account
- The minimum average balance required for a student NRE account is quite low. Most banks offer student NRE accounts with a minimum average balance of as low as Rs. 5000.
- For student NRE account, the interest rate offered is around 4% p.a. for end of day balances equal to or above Rs. 50 lacs and 3.50% p.a. for end of day balances below Rs.50 lacs.
- When you sign up for a student NRE account, you’ll be offered an International ATM-cum-Debit card. This card can be used for transactions and cash withdrawals in India as well as abroad.
- Funds can be deposited in foreign currency in a student NRE account. The account itself is maintained in INR.
- Funds in a student NRE account are fully repatriable, meaning that they can be moved to the student’s country of residence or anywhere else in the world as required.
- Interest earned in a student NRE account is completely tax-free.
Documents Required for a Student NRE Account
When you apply for a student NRE account, whether in India or overseas, you’ll be required to furnish the following documents:
- Passport: Copies of the first four and last four pages of your valid passport.
- Visa: Copies of valid student visa. If the student is holding a regular visa, then a copy of the admission letter or identity card from the college or institution is required to verify student status.
- Address proof
A student NRE account requires maintenance of a minimum balance or a monthly average balance (MAB). This minimum balance is usually INR 5000 for most banks. In case the minimum balance is not maintained, the bank will levy a service charge for the same.
Students living abroad have different requirements when it comes to banking. They need a bank account that can help them manage their finances in India as well as abroad. An account that also allows them to move their funds freely. A student NRE account does exactly this, and hence it can be considered the best student bank account for students living outside India.