NRI vs OCI

Who are NRIs?

A Non-Resident Indian (NRI) is an Indian citizen who resides outside of India for at least 182 days in a financial year but maintains significant connections to their home country. 

Despite living abroad, NRIs often maintain close ties with India through their family, investments, properties, or other interests. They may also actively participate in Indian cultural, social, or economic activities. 

The term "NRI" is commonly used to categorize and identify Indian citizens living abroad while emphasizing their continued association with India.

Who is an OCI?

An Overseas Citizen of India (OCI) refers to an individual who holds an OCI card and is considered an overseas citizen in layman's terms. An OCI is not a citizen of India, but rather someone who has been granted permission by the Indian government to reside and work within the boundaries of India.

The OCI card is issued to individuals who have a foreign nationality but have a significant connection to India, such as being of Indian origin or having Indian ancestry. This card grants certain rights and privileges to the cardholder while they are in India, including the ability to live, work, and study in the country without the need for a visa. Once an OCI card is issued, it does not expire and is eligible to remain valid for the whole life span of the cardholder.

Who Cannot be an OCI Cardholder?

• Individuals migrating from Pakistan and Bangladesh are ineligible for obtaining the OCI card, even if their parents hold citizenship in both countries.

• Those who have served in the military of foreign countries are not eligible to receive the OCI card.

• OCI cardholders, who work and earn income within India, are permitted to open special bank accounts at bank branches of Indian banks.

Note: The constitution of India does not permit dual citizenship, which is why the OCI card was introduced as a solution.

What are the Benefits and Limitations of Being an NRI or OCI Cardholder?

1. For NRIs

   Benefits	Limitations
   You have access to exceptional overseas accounts.	You are not eligible for purchasing agricultural land within Indian territory.
   The Indian education system grants you a special reservation quota.	Your income earned within India will be taxable.
   You are eligible to be a voter in Indian elections.	-
   Income earned outside India will not be taxed unless you receive the payment within India.	-

2. For OCI Cardholders

   Benefits	Limitations
   You have the privilege of enjoying lifelong multiple entries for visiting India.	You are not eligible for purchasing agricultural land.
   You are not required to register with local police authorities after 180 days.	You are not eligible for a government job.
   You do not need special permission to work and study in India.	You are not allowed to participate in Indian elections.
   You receive similar benefits as NRIs (Non-Resident Indians) in terms of financial and educational opportunities.	-

What is the Difference Between OCI and NRI?

Here's a table highlighting the key differences between OCI (Overseas Citizen of India) and NRI (Non-Resident Indian):

NRI Bank Account vs OCI Bank Account

India offers specialized bank accounts and deposits tailored for non-residents and individuals who wish to maintain strong ties with the country. These accounts provide options for safeguarding and growing their finances. The three main types of accounts available to non-residents are:

• Non-Resident Ordinary Accounts (NRO)

• Non-Resident External Accounts (NRE)

• Foreign Currency Non-Resident (Bank) Accounts {FCNR(B)}

**The accounts and eligibility criteria are the same for everyone, whether the individual is an NRI or an OCI cardholder.

The following section will provide a clear understanding of which individuals are authorized for specific accounts:

• NRIs are permitted for opening NRO, NRE, and FCNR(B) accounts.

• OCI cardholders are permitted for opening NRO, NRE, and FCNR(B) accounts. They are also permitted for opening domestic accounts in some instances.

• Foreign Nationals who are employed in India can open domestic bank accounts. However, they are not permitted to open NRO, NRE, and FCNR(B) accounts.

• International students studying in India are permitted to open NRO accounts. They are not eligible for opening domestic accounts, NRE, and FCNR(B) accounts.

• Foreign tourists on a visiting trip to India are eligible to open an NRO account. However, they do not qualify for opening domestic accounts, NRE, and FCNR(B) accounts.

Wrapping It Up!

The Indian government has been designing and introducing different measures for non-residents to feel free to work and reside in the country. However, every individual planning to migrate must know the standards and features to keep their roots intact and have a humble connection between their residing country and their ancestral country.