Best FCNR Account Interest Rates for NRIs in India

FCNR is an account designed for NRIs to open and maintain fixed deposits in foreign currency in India. This way, you can save your income in the currency you’ve originally earned them in. Unlike NRE and NRO accounts, FCNR accounts are specifically designed for those who want to save their income in foreign currency, offering exciting interest rates.

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What Is An FCNR (B) Account?

A foreign currency non-resident (FCNR) account is a bank account designed for NRIs to maintain their fixed deposit account in India. The deposits are held in foreign currency, specifically US Dollars, Canadian Dollars, Pounds, Euros, Japanese Yen, and Australian Dollars, thus protecting your savings from exchange rate fluctuations. The primary purpose of an FCNR account is to provide an efficient way to grow your savings in your home country without the risk of currency depreciation.

Only eligible individuals can open FCNR accounts in India. To be eligible, you must be an NRI, a Person of Indian Origin (PIO), or an Overseas Citizen of India (OCI). Moreover, the earnings must be in any of the six eligible currencies.

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The following are the features of FCNR accounts:

Term deposit accounts: FCNR accounts are term deposit accounts, not savings accounts. However, you can open an FCNR account by transferring money from your Non-Resident External (NRE) account.
Tenure: The tenure of the deposits ranges from 1-5 years.
Tax benefits: The interest you earn on FCNR deposits is completely tax-free in India.
Repatriation: The investment and interest are fully repatriable to your home country.
Premature withdrawal: They allow premature withdrawal; however, interest is only paid if you withdraw within one year from the date of deposit.

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How Is FCNR B Different From NRE/NRO?

FCNR accounts are very different from NRE or NRO accounts. The following are the major differences between the three accounts.

Currency: FCNR accounts accept deposits only in foreign currency, and withdrawals also happen in the same foreign currency. For NRE and NRO accounts, deposits can be made in Indian rupees or foreign currency, but withdrawals happen only in Indian currency.
Type of account: FCNR is a term deposit account, where NRE and NRO are savings and deposit accounts.
Taxability: Interest earned on FCNR deposits and NRE accounts is tax-free. However, interest earned on NRO accounts is taxable.
Repatriation: The principal and interest in FCNR and NRE accounts are fully repatriable. However, there are restrictions on repatriation for NRO accounts.
Tenure: The tenure of FCNR deposits ranges from 1-5 years, whereas for NRE and NRO, there is no fixed tenure.

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FCNR B Account Interest Rates 2024

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State Bank of India

Debt Mutual Fund Information

SBI FOREIGN CURRENCY NON-RESIDENT DEPOSIT INTEREST RATES
Currency	USD (%)		GBP (%)		EURO (%)		CAD (%)		AUD (%)		JPY (%)
Currency	USD (%)	USD (%)	GBP (%)	GBP (%)	EURO (%)	EURO (%)	CAD (%)	CAD (%)	AUD (%)	AUD (%)	JPY (%)	JPY (%)
One year	5.7	5.78	4.85	4.92	4	4.06	4.2	4.26	4.5	4.56	0.1	0.15
Above 1 year to less than 2 years	5.7	6.04	4.85	5.1	4	4.18	4.2	4.4	4.5	4.72	0.1	0.15
2 years to less than 3 years	4.55	4.89	4.75	5.12	1.5	1.55	3.8	4.04	4.4	4.72	0.1	0.15
3 years to less than 4 years	4.3	4.71	3.75	4.07	1.5	1.56	3.55	3.84	4.3	4.71	0.1	0.15
4 years to less than 5 years	3.85	4.27	3.75	4.15	1.5	1.57	3.6	3.97	4.2	4.69	0.05	0.05
5 years	3.9	4.33	3.65	4.03	1.5	1.57	3.65	4.03	4.1	4.57	0.05	0.05

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ICICI Bank

Debt Mutual Fund Information

ICICI Bank FOREIGN CURRENCY NON-RESIDENT DEPOSIT INTEREST RATES
Currency	USD (%)	SGD	AUD	GBP	CAD
12 months < 24 months	5	3.5	4.4	4.75	4
>= 24 months < 36 months	4	2.75	3.75	4	3.3
>= 36 months < 48 months	3.65	NA	NA	NA	NA
>= 48 months < 60 months	3.3	NA	NA	NA	NA
60 months	3.3	NA	NA	NA	NA

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Bank Of Baroda

Debt Mutual Fund Information

Bank of Baroda FOREIGN CURRENCY NON-RESIDENT DEPOSIT INTEREST RATES
Maturity Period	USD Less than 2 Lacs (%)	USD 2 Lacs TO 10 Lacs (%)	Above USD 10 Lacs (%)	GBP (%)	EUR (%)	AUD (%)	CAD (%)
1 Year	5.5	5.8	5.8	5	-	-	-
Above 1 Yr. to less than 2 yrs.	5.5	5.5	5.5	4.75	1.5	3.6	4.5
2 Yrs. to less than 3 yrs.	3.95	3.95	3.95	2.35	1.5	3.5	4.1
3 Yrs. to less than 4 yrs.	3.8	3.8	3.8	2.45	1.5	3	3.8
4 Yrs. to less than 5 yrs.	3.85	3.85	3.85	2.45	1.5	3	3.9
5 Years	3.9	3.9	3.9	2.45	1.5	3	3.95

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HDFC Bank

Debt Mutual Fund Information

SBI FOREIGN CURRENCY NON-RESIDENT DEPOSIT INTEREST RATES
Currency	USD (%)		GBP (%)		EURO (%)		CAD (%)		AUD (%)		JPY (%)
Currency	One year	Above 1 year to less than 2 years	One year	Above 1 year to less than 2 years	One year	Above 1 year to less than 2 years	One year	Above 1 year to less than 2 years	One year	Above 1 year to less than 2 years	One year	Above 1 year to less than 2 years
One year	5.7	5.78	4.85	4.92	4	4.06	4.2	4.26	4.5	4.56	0.1	0.15
Above 1 year to less than 2 years	5.7	6.04	4.85	5.1	4	4.18	4.2	4.4	4.5	4.72	0.1	0.15
2 years to less than 3 years	4.55	4.89	4.75	5.12	1.5	1.55	3.8	4.04	4.4	4.72	0.1	0.15
3 years to less than 4 years	4.3	4.71	3.75	4.07	1.5	1.56	3.55	3.84	4.3	4.71	0.1	0.15
4 years to less than 5 years	3.85	4.27	3.75	4.15	1.5	1.57	3.6	3.97	4.2	4.69	0.0	0.05
5 years	3.9	4.33	3.65	4.03	1.5	1.57	3.65	4.03	4.1	4.57	0.0	0.05

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DBS Bank

Debt Mutual Fund Information

DBS Bank FOREIGN CURRENCY NON-RESIDENT DEPOSIT INTEREST RATES
Tenor	USD (%)
1Y to <2Y	5.00
2Y to <3Y	4.00
3Y to <4Y	0.01
4Y to <5Y	0.01
5Y	0.01

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Benefits Of FCNR B Account For NRIs

The following are the benefits of FCNR interest rates:

Competitive interest rates: Banks offer competitive interest rates on FCNR deposits to attract foreign currency investments.
Fixed tenure: FCNR deposits have a fixed tenure of 1-5 years, providing a sense of certainty for NRI investors.
Security: These deposits are backed by the Indian banking system, making them comparatively less risky than marketable securities. For FCNR (B) accounts, deposits up to Rs 5 lakhs are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC) per depositor per bank.
Tax-free interest rates: The interest earned on FCNR deposits is entirely tax-free in India.
Repatriability: The principal and interest are fully repatriable to your country of residence without any restrictions.
Hedge against currency inflation: The investments in FCNR deposits are done in foreign currency. This provides you protection against currency exchange risk.
Flexibility: Many banks allow premature withdrawals of FCNR deposits even if the full tenure has lapsed. However, they charge a small penalty for the same. This allows you to access your funds whenever you want.

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Bottom Line

FCNR deposits are a suitable investment option for anyone looking for a domestic foreign currency investment. They offer attractive interest rates and tax benefits, making them suitable for both short—and long-term investments.

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Frequently Asked Questions

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How to open an FCNR account?

To open a FCNR account, you must first select a bank that offers FCNR deposits. All major public and private banks offer FCNR accounts. Then, gather necessary documents such as passport, visa, PAN card, proof of address, and KYC documents. You can open the account online or visit your bank's branch. Finally, fill out the application, submit all documents and make an initial deposit to open your FCNR account.

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What are the benefits of an FCNR account over NRE/NRO?

FCNR accounts offer a host of benefits similar to NRE accounts. Both FCNR and NRE accounts offer tax benefits, and the principal and interest are fully repatriable. NRO accounts don't offer tax benefits, and the principal and interest are repatriable with restrictions.

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What is the minimum deposit amount for IOB FCNR accounts?

The minimum deposit amount in IOB FCNR accounts is 1,000 in each respective currency. This means the minimum deposit amount is 1,000 USD, 1,000 GBP, and 1,000 EUR. However, for Japanese Yen, the minimum is JPY 100,000.

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What happens if I close my FCNR account within one year?

Ideally, closing an FCNR account before the term ends attracts a penalty. This penalty is usually in the form of a reduction in interest rate. Alternatively, banks might not pay you interest and just return the principal amount. Sometimes, some banks don't even charge a penalty. Hence, the penalty varies from bank to bank, and it is best to check with your bank when investing.

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\What is the difference between FCNR and FCNR B?

The difference between FCNR and FCNR B is that FCNR B was introduced to replace the existing FCNR A scheme, which had the Reserve Bank of India (RBI) and, later, the Government of India bearing the foreign exchange risk. FCNR A was discontinued because it posed quasi-fiscal costs to the government.

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