CLASSIFICATION OF CENTRES BASED

ON POPULATION

CLASSIFICATION POPULATION (AS POPULATION-GROUP WISE CLASSIFICATION OF

OF CENTRES PER 2001 CENSUS) CENTRES

Tier 1 1,00,000 and above

Rural Centre Population upto 9,999
Tier 2 50,000 to 99,999
Semi-urban centre from 10,000 to 99,999
Tier 3 20,000 to 49,999

Tier 4 10,000 to 19,999 from 1,00,000 to

Urban centre
9,99,999
Tier 5 5,000 to 9,999

Tier 6 Less than 5000 Metropolitan centre 10,00,000 and above

 BANK ACCOUNTS FOR NRIs

 NRO account (Non Resident Ordinary rupee account)

 NRE account (Non Resident External rupee account)

 FCNR(B) account (Foreign Currency Non Resident (Bank)

account)

WHO IS NRI (NON RESIDENT INDIAN)?

An Indian citizen, who is ordinarily
residing outside India and holds an
Indian passport.
 1. NRO ACCOUNT (NON RESIDENT
ORDINARY RUPEE ACCOUNT)

 Account will be in Indian rupees and with banks authorized by RBI.

 This account can also be maintained with the post offices in India
 Can be opened jointly with resident Indian
 Mainly used for local transactions in India
 If a citizen becomes an NRI, his existing account becomes NRO account
 Can be in the form of SA / CA / RD / FD
 Interest rates are within the purview of banks
 Income tax will be deducted as per the rules
 There is limit on the repatriation of funds. (Maximum of $ 1 million per year)
 2. NRE ACCOUNTS ( NON RESIDENT
EXTERNAL RUPEE ACCOUNTS)
 Account will be in Indian rupees and with banks authorized by RBI.
 Can be opened as joint account with another NRI.
 Can also be opened by the NRI with resident close relative, who is eligible to
operate the account as a Power of Attorney holder on “former or survivor basis”.
 Amount to be deposited in this account is earned on foreign land only.
 Can be in the form of SA / CA / RD / FD
 Minimum tenure of term deposits will be 1 year.
 Banks are free to determine interest rates. However, the interest rates shall not be
higher than the comparable domestic rupee deposits
 No income tax will be deducted in India.
 Fully repatriable to foreign countries.
3. FCNR(B) ACCOUNTS (FOREIGN CURRENCY
NON RESIDENT (BANK) ACCOUNTS)

 Only fixed deposit accounts can be opened with banks authorized by RBI.
 Can be opened as joint account with another NRI.
 Can also be opened by the NRI with resident close relative, who is eligible to
operate the account as a Power of Attorney holder on “former or survivor
basis”.
 Minimum term 1 year and maximum term 5 years.
 Can be maintained in approved foreign currencies.
 Rates of interest will be as per the RBI guidelines.
 No income tax will be deducted in India.
 Fully repatriable to foreign countries.
 LIBOR
 It is London Interbank Offered Rate
 It is the primary benchmark, for short
term interest rates around the world
 Many financial institutions set their
interest rates relative to it.
DTAA
 It is Double Taxation Avoidance
Agreement
 It is an agreement between two countries
with an objective to avoid taxation of the
same income in both the countries.
 India has got DTAA with several countries
 For availing DTAA benefit, the NRI has to
submit “Tax Residency Certificate” (TRC)
to the bank annually.
 POINT OF SALE TERMINALS (POS TERMINALS)
 It is a terminal at a store, where customer makes purchases
using debit card / credit card / prepaid card.

 Card needs to be swiped and the data embedded in the card is

electronically validated and gets authorized, if it is in order.

 It is the payment gateway of the merchant acquirer.

 The merchant establishment is required to hold an operative

account with the acquirer bank to avail this service.

 POS terminals are good source of “Non Interest Income” for

banks.

 New generation private sector banks are ahead in POS

terminals.
 IFSC CODE
 It is Indian Financial System Code.

 It is alpha – numeric code which identifies any branch under the

NEFT system

 It is 11 digit code
4 ALPHA CHARACTERS 0 LAST SIX DIGITS

Bank representative branch

 IFSC code is a must for money transfer through NEFT / RTGS.

HOW DO THE BANKS TRANSFER MONEY ELECTRONICALLY

NEFT … National Electronic Funds Transfer (For small amounts)
RTGS … Real Time Gross Settlement (For large amounts)
 NEFT – NATIONAL ELECTRONIC FUNDS TRANSFER

 It is a nation wise payment system facilitating one to one funds transfer.

 Individuals, firms and corporates can electronically transfer funds.
 Beneficiary must have an account with a NEFT enabled bank branch.
 Remitter (sender) can send maximum amount of Rs. 50,000/- per transaction (cash based
transaction), if he does not have any bank account.
 NEFT also facilitates one-way cross border transfer of funds to Nepal.
• Beneficiary need not have an account in Nepal.
• He will receive in Nepalese rupee.
• Limit is Rs. 50,000/- per each transaction.
 No limit for minimum or maximum amount of transfer. ( However, for amounts of Rs.2 Lakh and
above, RTGS is used.
 It works on the system of Deferred Net Settlement (DNS) basis, which settles transactions in
batches.
 NEFT operates on hourly basis
 No charges for inward transactions and there will be charges for outward transactions.
 RTGS… REAL TIME GROSS SETTLEMENT
 It is real time settlement without netting on an instruction by instruction basis.
 Funds settlement takes place in the books of RBI, hence it is final and irrevocable.
 Beneficiary branch should deposit in the beneficiary account within 30 minutes of
receiving the message.
 RTGS window is open from 9.00 hrs to 16.30 hrs on weekdays.
And 9.00 hrs to 14.00 hrs on Saturdays.
 Meant for high value transactions
 Minimum limit … 2 lakhs
 Maximum … no limit
 Inward transaction … no charges
 Outward transactions
 Rs. 2 lakh to Rs. 5 lakh … not exceeding Rs. 30 per transaction
 Above Rs. 5 lakh … not exceeding Rs. 55 per transaction