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New joint account holder facility for NRIs unveiled

January 20, 2014

Rejimon K

Muscat : In a bid to ease bank transactions for non-resident Indians (NRIs), the Reserve Bank of India (RBI) has allowed them to operate resident accounts on "either or survivor" basis. Earlier, NRIs were not allowed to operate such accounts during the lifetime of the local resident account holder. According to the RBI, banks may include an NRI close relative for the purpose of existing or new resident bank accounts as a joint holder with the resident account holder on "either or survivor" basis, subject to fulfilment of a few conditions. Such accounts will be treated as resident bank accounts and will be subject to all the regulations applicable to a resident bank account. Cheques, instruments, remittances, cash, card or any other proceeds belonging to the NRI relative shall not be eligible for credit to this account. Besides, the NRI relative will be able to operate such an account only for and on behalf of the resident for domestic payments and not for creating any beneficial interest for himself. An NRI can be a joint holder in more than one account, if he/she is a close relative of the resident bank account holders. If due to any eventuality, the non-resident account holder becomes the survivor of such an account, it shall be categorised as Non-Resident Ordinary Rupee (NRO) account according to the extant regulations, the RBI said. The onus will be on the non-resident account holder to keep the bank informed to get the account categorised as NRO account and all such regulations as applicable to NRO account shall be applicable. According to the RBI, the joint account holder facility may be extended to all types of resident accounts, including savings bank accounts. While extending this facility, the bank should satisfy itself about the actual need for such a facility and also obtain a declaration, duly signed by the non-resident account holder, said the RBI. Meanwhile, wealthy NRI businessmen are buying shares in medium-sized private sector banks of Kerala , hoping for a rise in valuations, even as the RBI is preparing licensing norms for a new set of private banks to enter the country's Rs.81 trillion banking industry, According to reports, NRI businessman Yusuff Ali , head of Abu Dhabi -based Emke Group , has picked up close to a five per cent stake in Dhanlaxmi Bank Ltd from the market over the last two months. With this latest acquisition, Ali has invested close to Rs510 crore in Kerala banks, he said. In 2010, brokerage Edelweiss Capital Ltd raised its stake in the CSB to 4.9 per cent. In a separate deal, Kerala -based Muthoot Pappachan Group had picked up a more than three per cent stake in the CSB.

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Source: Times of Oman

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