NRIs have many doubts when it comes to opening a joint account with their close relatives in India. RBI norms allow expatriates to open joint accounts with their close relatives in India. When such an account is to be opened, they can operate it either as 'either or survivor.' Before 2014, if the NRI wanted control over the account, the Indian joint account holder had to pass away. Such an account was operated under the 'former or survivor' norm.
The system of allowing expatriates to also transact in joint accounts would be beneficial in many ways and help monitor the account closely. Expats would also have greater control over the accounts. However, the account would be treated under the norms that apply to Resident Accounts. This means that cheques and cash from outside remittances cannot be accepted in the account. Further, if the expatriate wants to join his/her name to the accounts of Indian joint account holders, the account holders must be close relatives.
When the Indian counterpart dies, the sole right would come to the expatriate and the account would have to be made into as NRO accounts. NRE (Non-Resident External) and NRO (Non-Resident Ordinary) are the two accounts that can be opened by expatriates in India. Although close relatives in India can be added to the account, only those transactions that are sanctioned by the expatriate can be concluded by the joint account holder. There are controls that are applicable to the account. Expatriates who have income from India would have to receive those in his or her NRO account. Post Office accounts can also be converted to NRO accounts.
There are no restrictions in sending money from NRO accounts to foreign locations. If the NRO account holder dies, the money can be claimed by the nominee who is an expatriate. However, those nominees who are in India, cannot send the money outside except under special conditions such as to pay off financial liabilities.