The entire nation is stumped under the sudden impact of the denomination drive started by Prime Minister Narendra Modi. And, the most trending question today is: what to do with your old Rs 500 and Rs 1000 notes? Both Indians in India and Indians overseas are somewhere content yet confused, you could say. In the state of flux, there has been a great deal of information floating around, that may guide the common man, which includes financial experts and banks have also stepped in to give tips.
The answer is clear – according to RBI guidelines, an NRI can deposit the old Rs 500 and Rs 1,000 currency notes to his non-resident ordinary rupee (NRO) account.
For the non-resident Indians (NRIs) who keep Indian currency, the attempt to demonetize Rs 500 and Rs 1,000 notes may be problematic. As per the clarification issued by the Reserve Bank of India, the recourse for an NRI is to deposit the specified bank notes (Rs 500 and Rs 1,000) in his non-resident ordinary rupee (NRO) account. Now, the question that comes up here is – what if the NRI does not have the branch of his or her bank in the country of residence? And what’s more, will the foreign branch accept notes in rupees? These are some questions that NRIs will have to tackle. Another point that comes needs to be considered is that an NRI cannot keep more than Rs 25,000 in currency. Plus an NRI cannot deposit cash in a NRO account from a foreign country.
All this information, is food of thought for the NRI community. Some may also be worried, as they are far from their motherland. But solutions do exist.
According to financial experts, opening an NRO account may not be a problem for NRE account holders.
But, the reality of the situation is – This is going to be a tricky situation for NRIs. Normally, overseas Indians people don’t carry Indian currency abroad. Logic suggests that in case they do possess Indian currency notes (Rs 500 and Rs 1,000 notes) with them, they will have to deposit this money once they are back in India. Or, alternatively, they can send it to relatives or friends and ask them you deposit on behalf of them.
Federal Bank currently has over 2 million NRI customers. However, if you are a foreign tourist in India, you can purchase foreign exchange equivalent to Rs 5,000 using these high denomination notes at airport exchange counters till 24 November, with proof of purchasing these notes.