Are you an NRI looking to invest in India? If yes, you must have heard of various options for investing in the Indian market. Well, the safest option for you is an NRE Fixed Deposit. And before leaping, do understand how these investments work and what makes them distinct from other types of investments.
Here we will break down six key facts relating to NRE Fixed Deposits which you need to be aware of before setting aside your funds. Of course, investing comes with risk, but knowledge is power.
Features of an NRE Fixed Deposit account
NRI’s foreign income is converted to Indian Rupee when they open an NRE FD account. They can open this account either as an individual, with another NRI, or close relative of the resident Indian.
NRE FD rates are generally higher than Regular RD rates and NRIs get much-needed return stability. Banks provide an option to choose between a regular NRE Fixed Deposit account or a Flexi Fixed Deposit facility called NRE flexi Term Account. Check out these five things before you invest –
– Option to repatriate funds back to your country of residence
NRE Fixed Deposit rates offer an optimum return on your hard-earned money, allowing you to transfer funds back to your country of residence. Compared to other NRE Fixed Deposits, Flexi FDs provide greater flexibility regarding the repatriation of funds.
With NRE Flexi Fixed Deposits, you can partially withdraw your principal plus interest and keep the balance undisturbed till maturity.
– Guaranteed returns
India is filled with low-risk NRE Fixed Deposit accounts that offer high returns, perfect for those looking to grow their wealth. NRE Fixed Deposits allow you to choose from a range of maturity periods and tailor your investment strategy according to your risk appetite.
– No tax on an NRE FD in India
NRI’s can also choose between a Flexi-Fixed Deposit that offers more liquidity and NRE Fixed Deposits that tie up funds for a more extended period but offer higher returns. With a zero tax rate, NRE FD provides a reliable source of income with a compelling ROI on NRI investments in India.
NRE Fixed Deposits provide one of the most attractive opportunities for NRI investors looking to maximise their returns in India. This is because NRE FD rates are highly competitive, and when combined with the fact that you pay zero tax on either the interest or principal component, NRE FDs are an ideal investment.
– Broad tenure range
NRE Fixed Deposit rates offer flexibility to investors looking to make long-term investments. With these FDs broad tenure range, from 1-20 years, is available to investors. They can choose the right tenure for their NRE FD per their savings goals.
In addition, NRE offers a flexible option that enables customers to renew their FDs at their discretion – if an investor has opened an NRE FD for two years and wishes to extend it for another two before maturity, they can quickly request a renewal without any hassle. And the Flexi Fixed Deposit feature made investing in NRE secure, safe and convenient with easy transfer of funds from the linked savings account.
Who can apply for an NRE FD?
NRE Fixed Deposit rates are available to several different types of people, including NRI, PIO (Person of Indian Origin) cardholders, and even those with a diplomatic passport who are living outside India.