This Article was fact checked and last updated for accuracy on October 29, 2025 by Mani Karthik
August 2017. I’m sitting in HDFC Bank’s Indiranagar branch in Bangalore.
My return to India is official. My H1B stamped passport is now in my drawer. My sons are enrolled in school. My wife has unpacked the last suitcase.
But my bank accounts are still screaming “Non Resident.”
Time to fix that.
Let me walk you through exactly what I did. And what I wish I had known before starting.
What the RBI Actually Says
The Reserve Bank of India gives you a simple rule. Once you become a resident again, convert your NRI accounts within a “reasonable period.”
Most banks translate this to 6 months. Some say 3 months. ICICI Bank told me 90 days.
I took 4 months to complete my conversions. No penalties. But I wouldn’t push it beyond 6 months.
Here’s what nobody tells you upfront. You have three options when reconverting. Not just one.
Your Three Options Explained
| Option | What It Means | Best For |
|---|---|---|
| Convert to Regular Savings | Standard resident savings account with normal interest rates | Most returnees who plan to stay permanently |
| Convert to RFC (Resident Foreign Currency) | Keep foreign currency intact, can withdraw anytime | Those who might move abroad again or have dollar expenses |
| Close and Withdraw | Shut the account and take the money | If you don’t need that bank anymore |
The RFC option changed my life. Wish I had known about it earlier.
What I Did With My Accounts
My NRE Account at HDFC
I had about $45,000 sitting in this account. Money from my US salary that I had transferred over the years.
I converted this to an RFC Dollar account.
Why? Two reasons.
First, I wasn’t 100% sure the India move would stick. My wife was skeptical. My US born son was struggling with the heat and mosquitoes.
Second, I still had some dollar expenses. My domain hosting. Some software subscriptions. A life insurance policy I kept active in the US.
The RFC account let me keep dollars as dollars. No forced conversion to rupees.
My NRO Account at ICICI
This had my rental income from my Chennai property. About Rs 8 lakhs accumulated over two years.
I converted this to a regular savings account.
Simple process. Took 10 days.
The rental income now flows into my resident account. Tax deducted at source still happens. But at resident rates now, not the flat 30% NRI rate.
My Wife’s NRE Account at Axis
She had her own NRE account. Smaller balance. About $8,000.
We just converted it to a regular savings account. She didn’t need the RFC option.
Her process was faster than mine. 7 days total.
The Step by Step Process
Step 1: Prove You’re a Resident Again
Banks need documentation that you’re back for good.
I submitted:
- My passport with the US exit stamp
- My Aadhaar card with Indian address
- My rental agreement in Bangalore
- My PAN card
- A declaration letter stating I’m now a resident
Some banks wanted my employment letter from my Indian company. HDFC didn’t ask for it. ICICI did.
Step 2: Choose Your Conversion Type
This is where you decide between regular savings or RFC.
Think hard about this. You can’t easily reverse it later.
I chose RFC for my main account. Kept my dollars liquid. Could convert to rupees whenever exchange rates looked good.
My friend Rajesh converted everything to rupees immediately. Regretted it three months later when the rupee weakened and he needed to pay his daughter’s US college fees.
Step 3: Visit Your Branch
Yes, physical visit required. I tried doing this online. Didn’t work.
Some banks let you do it at any branch. Some insist on your home branch.
HDFC was flexible. ICICI made me go to my original Chennai branch. I was living in Bangalore. Had to make a special trip.
Not fun.
Step 4: Fill Out Forms
Every bank has different forms.
HDFC had a single form for NRE to RFC conversion. Simple.
ICICI had three forms. Account conversion request. KYC update. Foreign account closure declaration.
I made mistakes on two forms. Had to refill them. Bring fresh photographs.
Carry extra passport photos. Trust me on this.
Step 5: Wait for Processing
| Bank | My Timeline | Documents Needed |
|---|---|---|
| HDFC Bank | 7 working days | Passport, Aadhaar, PAN, declaration letter |
| ICICI Bank | 12 working days | All above plus employment proof and rental agreement |
| Axis Bank | 8 working days | Standard documents, wife’s case was simpler |
Your internet banking access might break temporarily. Mine did.
For three days, I couldn’t log into HDFC net banking. They were migrating my account. No warning. No notification.
I panicked. Called customer service. They said it’s normal.
Would have been nice to know beforehand.
What Happens to Your Money
Your account balance stays intact. No forced withdrawals.
But here’s the catch. If you’re converting NRE to regular savings, you’re converting dollars to rupees.
The bank uses their exchange rate. Not the market rate. Their rate.
I lost about Rs 15,000 in the conversion spread. The bank’s rate was 50 paise worse than the mid market rate.
On $45,000, that adds up.
This is why RFC made sense for me. I kept my dollars as dollars. Converted them slowly over six months as rates improved.
Made back that Rs 15,000 and then some.
The RFC Account Advantage
RFC accounts are brilliant for returnees. Here’s why.
You can hold money in foreign currency. Dollars, Euros, Pounds. Your choice.
You can convert to rupees whenever you want. No restrictions. No questions.
You can send money abroad if needed. Up to your original foreign currency balance.
The interest rate is terrible though. Almost zero. But you’re not keeping money in RFC for interest. You’re keeping it for flexibility.
I kept my RFC account active for 18 months after returning. Converted dollars to rupees in small chunks when rates were favorable.
Then closed it and moved everything to regular savings.
By then I was sure the India move was permanent. My wife had settled in. My sons were thriving in their school. My fears about moving back had disappeared.
Read more about financial planning after returning to India if you’re in the same boat.
Tax Implications You Should Know
The moment you become a resident, your worldwide income is taxable in India.
Your NRE account interest was tax free as an NRI. Now it’s taxable.
Your NRO account interest had 30% TDS. Now it’s taxed at your slab rate.
File your returns properly. I messed up my first return after coming back. Claimed wrong deductions. Got a notice from the tax department.
Had to hire a CA to sort it out. Cost me Rs 8,000 in professional fees.
Don’t be like me. Get professional help for your first ITR filing after returning.
Common Mistakes Returnees Make
Mistake 1: Waiting Too Long
My cousin waited 14 months to convert his accounts. The bank froze them.
He couldn’t access his money for three weeks while they processed the paperwork. Nearly missed his EMI payments.
Convert within 6 months. Don’t test the system.
Mistake 2: Closing Accounts Too Fast
I almost made this mistake. Nearly closed my NRE account in the first month.
Good thing I didn’t. I had some consulting payments coming from US clients. Took 4 months to arrive.
If I had closed my NRE account, those dollar payments would have gone into my resident account. Tax complications would have followed.
Keep your NRI accounts active for at least 6 months after returning. Clear all pending foreign transactions first.
Mistake 3: Not Considering RFC
Most returnees don’t even know RFC accounts exist. Banks don’t actively promote them.
You have to specifically ask for RFC conversion.
If there’s even a 10% chance you might move abroad again, get an RFC account. The flexibility is worth it.
Mistake 4: Forgetting Linked Investments
My mutual funds were linked to my NRE account. My SIPs failed when I converted to regular savings.
I had to update my bank details with every fund house. HDFC Mutual Fund. ICICI Prudential. SBI Mutual Fund. Ten different AMCs.
Took me six weeks to complete all updates.
Update your investment folios before converting accounts.
What About Joint Accounts
My wife was a joint holder on my NRO account. That conversion was smooth.
But she was also on my NRE account. That created issues.
For NRE to RFC conversion, both holders need to be present at the branch. Or you need a power of attorney.
My wife couldn’t come to the bank that day. Our younger son was sick.
I had to reschedule. Make another trip. Get both of us there together.
If you have joint NRI accounts, coordinate your schedules before visiting the bank.
Online Banking After Conversion
Your customer ID usually stays the same. But your account number might change.
HDFC kept my account number for RFC conversion. ICICI gave me a new number for the regular savings conversion.
Update your billers. Your EMI mandates. Your credit card bill payments.
I forgot to update my electricity bill payment. Missed one month. Got a disconnection notice.
Make a checklist of all your automated payments and update them systematically.
When You’re Not Sure
Every person’s situation is unique. Your bank might have different procedures. Your documents might vary.
If you’re confused about the reconversion process, ask in our Facebook community.
We have thousands of members who have done this. Different banks. Different cities. Different scenarios.
The collective wisdom helps. Someone has faced your exact situation before.
Real experiences beat any guide.
Sources and Documentation
All information verified against current RBI and banking regulations as of 2024.
Key Sources:
Reserve Bank of India – FEMA Regulations on NRI Accounts
Income Tax Department – Residential Status Guidelines
HDFC Bank – RFC Account Information
ICICI Bank – NRI Account Conversion Process
Always verify current procedures with your specific bank. Rules evolve. Your branch might have additional requirements.