3 A BFM Correspondent Banking and NRI Accounts
Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Bank Financial Management — CAIIB.
One-liners from this chapter
Free sample — 8 of 66 rapid-fire Q&A cards.
What is a correspondent bank?
A correspondent bank is a financial institution that provides services on behalf of another bank, typically in a foreign country, facilitating international transactions, fund transfers, and trade finance.
What is the maximum repatriation limit from an NRO account per financial year?
USD one million per financial year with CA certificate.
What is a NOSTRO account?
A NOSTRO account is an account held by an Indian bank in a foreign bank in the foreign currency of that country, used to settle international transactions ('our account with you').
What is the maximum tenure for an FCNR(B) deposit?
Maximum five years from date of deposit.
What is a VOSTRO account?
A VOSTRO account is an account maintained by a foreign bank with an Indian bank in Indian Rupees, representing 'your account with us' from the perspective of the domestic bank.
Which currencies are permitted for FCNR(B) accounts?
USD, GBP, EUR, JPY, CAD, AUD and other RBI-approved currencies.
What is a LORO account?
A LORO account refers to a third-party account, i.e., the account of a third bank held with a correspondent bank, meaning 'their account with you' used when referencing another bank's arrangement.
Can NRI accounts be held jointly with resident Indians in India?
NRO can; NRE and FCNR(B) cannot with resident Indians.
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