A Fixed Deposit is a good investment tool for people who prefer conservative and safe means of investments. You need to accumulate a specific sum and deposit it within a specific tenure. Doing this keeps your investment safe while you earn higher interest rates on the deposit than parking the sums in the Savings Account.
Both Resident Indians and Non-Resident Indians can open FDs out of their savings. This article highlights the most common and frequently asked questions about NRI Fixed Deposit.
What are the different types of FDs NRIs can open?
You can open three different types of NRI FD: Non-Resident External Rupee or NRE Fixed Deposits, Non-Resident Ordinary Rupee or NRO FDs and Foreign Currency Non-Repatriable or FCNR Deposits.
How to open one?
If you choose to open an NRE or NRO Fixed Deposit, you can do it directly through Internet Banking. Choose the amount you seek to invest and the investment tenure. The FD gets opened instantly, and the bank assigns an FD Account number to you. However, if you want to open an FCNR Deposit, open the account and deposit the specific foreign currency. Once you have opened it, follow the same steps with NRE and NRO FDs.
In what currency can I create the deposit?
Even though you can only deposit foreign currencies in the NRE Account, the sums immediately convert to INR. You can deposit both INR and foreign currencies in NRO Fixed Deposit online that gets converted to INR. As such, both NRO and NRE FDs are Rupee deposits. Only your Foreign Currency FDs get opened in the foreign currency.
In what currencies can I open my FDs?
When you open NRO Fixed Deposit Account, your currencies are in INR. However, for foreign currency deposits, FDs are in USD, GBP, EUR, JPY, CAD, AUD, NZD, SGD, KHG and even SEK, DKK. However, check with your bank about accepted deposit currencies as a few banks only allow the basic currencies, i.e., USD, GBP, EUR, CAD, AUD, and JPY.
What are the interest rates offered?
The NRI FD interest rates on your deposits are not constant. It changes periodically by the Reserve Bank of India and the banks offering NRI services. Typically, the interest rates for NRE and FCNR Deposits are the same, whereas the interest rates for NRO Deposits for resident Indians are the same.
What are the minimum and maximum deposit terms?
The minimum deposit term for NRE and NRO Deposits is seven days, whereas the maximum term is 10 years. For FCNR Deposits, the minimum investment term is a year, and the maximum investment is five years.
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