A non-resident Fixed Deposit is widely known for its benefits. It acts as a lucrative investment option for global Indians. It allows them to deposit income earned overseas safely. Plus, it enables them to expand their savings effectively. An NRI Fixed Deposit Account has three types. A popular one is the Non-Resident External or NRE Fixed Deposits. It is a type meant for NRIs, and the following are the features that help you understand it better:
Repatriation
An NRE FD Account offers full repatriation. This means you can withdraw the principal amount and the interest earned. Hence, it appeals to the needs of many NRI investors.
Tax liability
Often, your interest earnings get affected by taxation. This further hampers your overall investment growth. But with NRE FD, you do not face this situation. Unlike other NRI FDs, it does not attract taxes. As a result, it makes for a better investment option for first-time investors.
Interest rates
The progress of an investment depends on various factors. But the most important one of them is the rate of interest. It plays a significant role in the growth of your deposit. It also determines the pace at which your invested funds increase. Precisely why, an NRE Fixed Deposit Account offers relatively high interest rates. It builds your investment quickly. Plus, the tax-free policy enables you to reap the actual benefits of an FD Account.
Fund sources
An NRE FD converts the deposited income earned overseas into Indian Rupee. This way, you may open an account with foreign currency. They automatically turn the funds into INR. It will also maintain the funds in the same manner.
Processing time
It does not take much time to open NRE Fixed Deposit External Account. The fastest mode is online. But if you cannot do that, you could also open offline. For this, visit the nearest branch of your bank. In either case, you need to present documents like:
- Permanent Account Number (PAN) Card or Form 60
- A valid Indian passport
- Proof of address (of both India and overseas) as per Customer Identification Policy
- Proof of NRI or Person of Indian Origin (PIO) status
- Recent passport size photographs
These are the basics. Your bank may ask you to submit other relevant documents. Once you do so, it should not take much time to open your NRE FD Account.
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