With a view to providing full convertibility of deposit schemes for non-resident Indians and rationalizing the existing non-resident deposit schemes, RBI vide its circular No. 28 AP (DIR Series) dated 4 March 2002 had decided to discontinue NRNR Account and NRSR Account schemes with effect from 1 April 2002. Accordingly, with effect from 1 April 2002:
-
Authorised dealers/authorized banks shall not accept any fresh deposits or open any fresh account, by way of renewal or otherwise, under the above two scherties.
-
The existing accounts under NRNR account scheme may be continued only upto the date of maturity. The maturity proceeds of the deposits under NRNR Account Scheme shall be credited to the account-holder’s Non-Resident (External) Rupee Account (NRE account), after giving notice to the account-holder that the maturity proceeds shall be credited to his NRE accounts. The account- holders may choose to credit the maturity proceeds to his NRE saving bank account or current account or open a fresh NRE term deposit account. The authorized dealers or authorized banks may also permit the account-holder, on his request to credit the maturity proceeds to NRO account. In case no reply is received from the account-holder, the maturity proceeds of deposits under NRNR account Scheme may be credited to his NRE account.
-
The existing term deposits under the NRSR account scheme may be continued till the maturity and the maturity proceeds shall be credited to the Non-Resident (Ordinary) Rupee Account (NRO account) of the account-holder.
-
The existing NRSR account, other than term deposit, shall not be continued after 30 September 2002, and may, at the option of the account-holder, be closed or balance thereof be credited to his NRO account on or before that date. For this purpose, a notice to the account-holders may be given and in case no reply is received, the said NRSR account may be closed and the balance transferred to the NRO account of the account-holder.
While the facilities currently available to the account-holders for premature withdrawal continue, in the event of premature closure of the term deposits, under both the schemes, the option of reinvesting the proceeds will, however, be restricted to the NRO account of the account-holder. |
