Difference Between NRI and OCI

When my friend came back to India for business purposes, he got confused about these terms. So I had to research them a little bit and explain them to her. From what I studied, the only reason to determine your residency status is for income tax purposes. This answer will guide you on OCI vs NRI.

What is the difference between OCI and NRI?

Non-resident Indians are those with Indian ancestry or birth who reside outside of the Indian Republic.

Overseas Indians (also known as PIOs) are Persons of Indian Origin. They are people who were born Indian or originated from Indians and reside outside the Indian Republic.

What is OCI and NRI difference in bank accounts?

1) NRIs are allowed to open FCNR(B) (Foreign Currency Non-Resident Bank) accounts, NRE (Non-Residents External Accounts), and NRO (Non-Residents Ordinary Accounts).

2) PIOs are allowed to open FCNR (B) (Foreign Currency Non-Resident Bank), NRE (Non-Residents External Accounts), and NRO (Non-Residents Ordinary Accounts) bank accounts.

3) Non-Residents Ordinary Accounts, Non-Residents External Accounts, and FCNR (B) (Foreign Currency Non-Resident Bank) bank accounts can all be opened by OCI cardholders.

4) It is permissible for foreign students studying in India to open an NRO (Non-Residents Ordinary accounts). Domestic accounts, NRE (Non-Residents External Accounts), and FCNR (B) (Foreign Currency Non-Resident Bank) bank accounts cannot be opened by them.

These are the main points regarding the OCI vs NRI.

Hi Dishu,

Don’t we all like to flex a little about that NRI cousin that we have? I’m sure we all do. But when it comes to understanding the difference between NRI vs OCI, we usually confuse them to be similar. But let me tell you, both these concepts are poles apart. I’ll say I am one of those lucky ones, who has both an NRI cousin and an uncle who holds an OCI Card. So let me take this opportunity to explain the difference between NRI and OCI.

An NRI or Non-resident Indian is an Indian Citizen who stays outside India for employment or business purposes and intends to stay outside India for an indefinite period. While an OCI or Overseas Citizen of India is a foreign citizen who gets registered as an Overseas Citizen of India Cardholder under Section 7A of the Citizenship Act, 1955. It allows foreign citizens to live in or work in India for an indefinite period of time.

I would like to elaborate on the difference between NRI and OCI with the help of a table.

I hope now you clearly know the difference between NRI and OCI and you will not be confused about it ever.