All you need to know about an FCNR Account.

 Providing NRIs with lucrative returns without much hassle was the main objective with which the FCNR account was first introduced. This primary objective still holds. 

What is an FCNR Account?

FCNR stands for Foreign Currency Non-Resident Account. It is a term deposit account popularly known as an FCNR deposit. These fixed deposit accounts are opened for depositing foreign currency income earned overseas. The account is maintained in the same foreign currency as deposited. 

NRIs (Non-Resident Indians) and PIOs (Person of Indian Origin) are eligible to open an FCNR account with an authorized bank or dealer.


 

FCNR account is more beneficial to those NRIs who are sure to repatriate their funds from the account on maturity. Also, FCNR deposits are a good option for NRIs who are looking for a secure hassle-free fund deposit option in India. You can book your FCNR Account in 

  • US Dollars

  • Canadian Dollars

  • Australian Dollars

  • Pound Sterling

  • Swiss Franc

  • Euro

  • Japanese Yen

And a few more currencies that hold global goodwill overseas. 

Documents required to open an FCNR Account

Opening an FCNR account from the comfort of your residence has now become quick and hassle-free. All you have to do is get in touch with a bank’s representative, fill out the required application online and attach the following documents with it:

  • Proof of your NRI status (Visa or Work Permit)

  • Address Proof in your country of residence

  • Address Proof in India

  • Copy of your Passport and passport size photograph

  • Copy of your ID proof (PAN Card or Form 60)


Features of an FCNR Account

Your FCNR account gives you unmatched privileges, which compel NRIs to park their funds in India. 

  • Term Deposit Account – FCNR account is a term deposit account which means it is opened for a fixed tenure of anywhere between 1 year to 5 years. On completion of this period, the principal amount in the FCNR account and its interest can be redeemed by the account holder. In case of premature withdrawal of funds from the FCNR account, interest will only be paid to the holder if the amount has been deposited for over 1 year.

  • Tax Benefit – Interest earned on the amount deposited in your FCNR account is completely tax-free in India.

  • Repatriation – You can repatriate the entire principal and interest amount deposited in the FCNR account. This amount is completely transferable as per the account holder’s wish. 

  • FCNR interest rates – Avail lucrative interest rates on your FCNR account. It is beneficial for NRIs living in countries that provide a very low interest on deposits in their country of residence. Such NRIs can deposit their income in India and enjoy the benefit of higher returns. SBM Bank India, provides one of the highest interest rates on its FCNR deposits. 

  • Exchange rate fluctuation – We already know that the amount deposited in the FCNR account is maintained and withdrawn in the same foreign currency as deposited. Hence, there is no risk of exchange rate fluctuations that occur due to the conversion of funds into Indian currency while depositing and again into foreign currency on withdrawal.

  • Account-holders – An NRI can hold an FCNR account single-handed or jointly with 2 or more joint NRI account holders or a relative who is a resident of the Indian subcontinent. This helps you well manage your account from a distance. 

  • Loan against account – An NRI can also apply for a loan in Indian currency keeping your FCNR fixed deposit account as collateral. Loans thus taken, can be repaid from the redemption amount of the FCNR account on maturity. 

  • Multiple currencies – FCNR accounts are highly beneficial for NRIs, especially ones who have their business spread across various countries. An NRI can deposit multiple currencies in their FCNR account as directed by RBI.

Therefore saving your funds in FCNR deposits in India will give you higher returns and more benefits than saving your funds in the country of your residence. Keeping all this information in mind while you open your FCNR account will surely help you maximize your benefits while you transfer your funds from and into your account from any place within or outside India. SBM Bank India’s personalised banking is happy to support you in case of any assistance that you may require. Also, visit SBM Bank India to know more about our NRI saving accounts.


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