Benefits of FCNR Account

Posted on Tuesday, December 12th, 2023 | By Indusind Bank

FCNR accounts provide NRIs with a secure, risk-free investment choice, offering fixed interest rates and protection from forex fluctuations. With an FCNR account, you can enjoy tax exemptions in India, along with the convenience of free and full repatriation. With high return and flexible tenure options, FCNR deposits are a favourable option for NRIs to maximise their savings and manage wealth efficiently.

When it comes to growing wealth, a safe, risk-free investment vehicle in India is a non-negotiable necessity for NRIs (Non-resident Indians). Such a vehicle assures you of a safety net against market volatility, even as your idle funds earn interest.

An FCNR (Foreign Currency Non-Resident) account checks all these boxes for NRIs, offering a safe investment opportunity to NRIs. Additionally, interest rates offered on an FCNR account in India are high and you get protection from fluctuations in foreign exchange rates. This makes FCNR deposits an attractive investment proposition for NRIs.

New-age banks such as IndusInd Bank offer flexible and lucrative FCNR deposit schemes that allow you to make the most of your foreign savings. Learn how to unlock the full spectrum of benefits associated with FCNR deposits for NRIs in this handy guide.

What is an FCNR Account?

An FCNR deposit account is a fixed-term investment option for NRIs. In essence, it works like a term deposit scheme with a fixed tenure and interest rate. This fixed deposit holds your overseas earnings in foreign currencies permitted by the bank. This means your funds enjoy immunity from exchange rate risks.

The account can be opened for a duration of 1 to 5 years, with premature withdrawals attracting a penalty. However, if you liquidate the deposit before the completion of a year, no interest is payable.

Benefits of FCNR Deposits

Here are six benefits of investing in these rewarding instruments.

1. Risk-free Investment for NRIs

An FCNR deposit for NRI is akin to a fixed deposit, wherein the applicable interest rate remains fixed throughout the tenure. Since this rate is not dependent on market conditions, an FCNR account is a risk-free proposition for NRIs.

2. Immunity from Forex Fluctuations

Since FCNR deposits hold your savings in foreign currency, your funds do not go through currency conversion. Upon maturity, you receive the principal and interest in the original foreign currency. This protects your funds from foreign currency fluctuations, which can sometimes undermine returns.

3. Tax Exemption in India

The interest earned on an FCNR account is exempt from tax in India. However, it might be taxable in your country of residence. It is recommended you consult a tax advisor to understand your overall tax obligation.

4. Repatriation of Funds

Both the interest and principal on your deposit are freely and fully repatriable. This means you can easily transfer money from your deposit to your resident country account.

5. Compounded Returns

IndusInd Bank compounds the interest rate on the deposit on a half-yearly basis. This makes an FCNR deposit decidedly more attractive for NRI investments.

6. Multiple Currencies

IndusInd Bank allows you to book an FCNR account in six international currencies: USD, GBP, AUD, JPY, CAD, and EUR.

Unleash the FCNR Account Advantage with IndusInd Bank

Offering attractive returns, tax-free interest, and protection against forex fluctuations, FCNR deposits are a smart choice for NRIs looking to maximise their savings and manage their wealth effectively.

IndusInd Bank’s rewarding FCNR deposit schemes come with attractive interest rates and flexible tenures, allowing you to effectively grow your savings in a foreign currency. Moreover, with convenient repatriation facilities and compatibility with multiple currencies, IndusInd Bank’s FCNR accounts make it easy for NRIs worldwide to save, grow, and move money.

Learn more about IndusInd Bank’s FCNR deposits for NRIs here.

Disclaimer: 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. Hence, you are advised to consult your financial advisor before making any financial decision. IndusInd Bank Limited (IBL) does not influence the views of the author in any way. IBL and the author shall not be responsible for any direct/indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information.