Planning to Invest in FCNR Fixed Deposits? Here's What You Need to Know

Living abroad and planning to invest in India? A Foreign Currency Non-Resident (FCNR) Fixed Deposit account could be a good option for you.

As a Non-Resident Indian (NRI) or a Person of Indian Origin (PIO), you can invest in an FCNR Fixed Deposit for a certain tenure, all the while earning interest on your investments. The advantage of an FCNR Fixed Deposit is, there is no exchange loss when the NRI account holder returns to India.

About FCNR Fixed Deposits

As an NRI or PIO, you have the liberty to invest in a fruitful fixed deposit in foreign currency. As per RBI guidelines, banks currently accept FCNR Deposits in Euro, British Pound, US Dollar(USD), Australian Dollar (AUD), JPY (Japanese Yen) and Canadian Dollar (CAD).

When you invest in an FCNR Fixed Deposit, the funds are collected in foreign currency. So, you need not worry about conversion rates and other hassles while making transfers to the account. One of the advantages of the said FD is that both, Principal and Interest, are fully repatriable or convertible to NON RESIDENT EXTERNAL (NRE) Account.

The interest you earn on an FCNR Fixed Deposit account is governed by the RBI. Please refer the link for the latest interest rates offered on FCNR FD.

An FCNR Fixed Deposit can be held jointly, and you can nominate an NRI or resident Indian to the account. Incase joint holder or 2nd holder is a resident in India, the mode of operation would be “Former or survivor”. Moreover, you can choose to invest in FCNR Fixed Deposits for a tenure of one year to five years, where the Interest on FCNR FD is exempt from Income Tax.

You can read more about the FCNR Deposit here.

How to open an FCNR Fixed Deposit Account?

Most banks let you open an FCNR Fixed Deposit Account online. Log in to the official website of your bank and go to the FCNR Fixed Deposit page and follow the instructions. To open an FCNR Fixed Deposit with HDFC Bank, you can either book an FCNR deposit by giving written instructions and submitting FCNR booking form to your branch or book FCNR FD via NetBanking. To apply through the NetBanking procees, you need to follow the following:

Accounts>Transact?Open FCNR FD> Fill in the required details> Confirm

You can also refer the below link for more details and terms and conditions that needs to followed while booking FCNR FD.

Planning to open and invest in FCNR Fixed Deposit account, click here.

* The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances. You are recommended to obtain specific professional advice from before you take any/refrain from any action. Tax benefits are subject to changes in tax laws. Please contact your tax consultant for an exact calculation of your liabilities.