Almost every Indian student dreams of studying abroad at some point. And even the ongoing Covid-19 pandemic has not changed it. In only the initial two months of 2021, about 72,000 Indian students left the country and joined foreign universities to pursue their higher studies, recent statistics revealed.
In the process of joining a foreign university, money plays a significant role, from arranging funds to managing them. When you land in a foreign country, you may face several challenges related to money management.
A student studying abroad has to pay several types of university fees. Moreover, colleges and universities approve the admission only after the student pays the admission fees from India. However, it doesn’t end there. That’s the beginning. After paying up the admission fees, the student needs money for daily expenses. Living outside the country is undoubtedly an expensive affair, considering the change in currency value. Hence, parents have to assist their children in providing for their rent, food, and other needs. Many students take up part-time jobs to bear their expenses. They work before or after college and fund their expenses. Some even send a trench of it back home to India.
In such a case, transferring money is not a problem, but it is important to note a few things. For example, it will be easier to make transactions to India and manage your finances if you open an NRI account. However, it is crucial to be mindful that you acquaint yourself with Indian foreign exchange remittance policies, know the rules and regulations, and follow them to get an NRI account that offers multiple benefits.
Benefits of an NRI Account
Students who go abroad for higher education purposes are treated as an NRI under the Foreign Exchange Management Act (FEMA). If you are one such student, you must know that you can avail multiple banking facilities, similar to what is provided to NRIs.
However, the process to open an NRI account is different from that of an Indian citizen. As per the FEMA regulations, though you are eligible to open an NRI account, you cannot hold a savings bank account. So, you will be left with two options: either open an NRI account or convert your existing savings account into one.
You can use the NRI account for transferring money, availing of similar facilities like NRIs who live abroad on work permit visas. You can opt for the most common NRI account, a non-resident external (NRE) account, though several types of NRI accounts are available to students studying overseas. You can convert your savings account to a non-resident ordinary (NRO) account, too.
You can consider opening or converting your bank account at Indian banks like ICICI Bank, as it offers NRI students the option to open an NRE account. Having an NRE account with ICICI Bank will allow you to manage your finances conveniently. Besides enabling you to transfer money internationally at ease, the account also provides many other benefits, including reasonable interest rates. If you decide to open the NRE account at ICICI Bank, you can expect to get an interest of 4 per cent annually if your balance is Rs 50 lakh and above and 3.50 per cent per annum your account balance is below Rs 50 lakh.
Besides, the bank also allows online money transactions to beneficiaries across 100 banks in India. Another attractive perk of your NRE account with ICICI Bank is that the interest earned is exempted from tax.
