Brief Overview Of Nri Deposits

By Author: Neha Sharma
Total Articles: 170
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With more than 20 millions of NRIs across the globe, NRI banking has become a crucial way to reconnect NRIs with India. NRI banking partners offer several financial products to NRIs. Amongst other products like NRE & NRO savings accounts and NRI loans, NRI deposits is gaining popularity over the course of last year. Let’s explore the basic aspects of these deposits, which will assist you see merits and demerits of this product line.

Types NRI deposits:

There are three types of deposits available for NRIs. You can open fixed deposits, recurring deposit or Foreign Currency Non Resident (FCNR) deposits. However, you can open fixed deposits and recurring deposits as NRE or NRO account. So, in totality, you have 5 types of deposits to consider when you want to invest your funds in Indian deposits.
• NRE (Non Resident External) fixed deposits
• NRE (Non Resident External) recurring deposits
• NRO (Non Resident Ordinary) fixed deposits
• NRO (Non Resident Ordinary) recurring deposits
• FCNR (Foreign Currency Non Resident) deposits

Reasons to invest in NRI deposits: ...
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Each deposit is a very specific in terms of interest rates, taxation, repatriation, overdraft facility, etc. But, primary reasons for popularity of these financial products are as follows:
• Interest rates: Fixed deposit interest rates in India are much higher than some of the other economies across the world. NRIs will prefer to take benefit of these higher interest rates.
• Exchange rate fluctuations: Rupee has been weakening against dollar for quite a while now. This is a great time to take advantage of this exchange rate and remit to India for NRI deposits. This allows you to earn more interest and then repatriate much higher sum on maturity. However, if you do not want to transfer your funds in rupee at this point of time, you have an alternate choice. Though NRE & NRO deposits hold your funds in rupee and offer you higher interest rates, FCNR deposits offer you equivalent interest rates on the funds held in foreign currency.

• Low risk product: These deposits are ideal financial products for NRIs. Whether you opt for NRE fixed deposit or FCNR deposits, you will earn higher interest without a threat of losing money. In volatile economies, it is a great form of investment indeed.

NRI deposits and finance:
These deposits do seem lucrative choice. However, you will need to consider few financial elements to make a right choice.
• Tenure
• Type of interest payment – monthly, quarterly, on maturity
• Income tax on interest
• Limited repatriation on NRO FDs and recurring deposits

So, consider all facets and make most suitable investment.

Author Bio :- Neha Sharma is an avid finance student, who loves to write during her free time. She has great understanding of NRI deposit products like FCNR deposits, NRE fixed deposits, etc. She offers this information freely online to share her interest with others.