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Deposit your foreign income in an NRE Fixed Deposit (FD) account if you are a Non-resident Indian and earn tax exempt returns. Browse NRE fixed deposit interest rates from some of the leading issuers to optimise your investment strategy and maximise returns.
Last updated on: February 02, 2026
As an NRI, you can deposit your foreign currency in India using a Non-resident External (NRE) fixed deposit account. These NRE accounts come with a wide range of features and benefits. They hold the invested amount in Indian Rupees. You can also repatriate the complete deposit, which includes the principal and interest, at any time.
The NRE FD rates vary across financial institutions. To find out the best NRE rates for yourself, browse the below table to know the interest rates offered by some banks in India:
| Financial Institution | Maximum Interest Rate for Regular Citizens (p.a.) | Maximum Interest Rate for Senior Citizens (p.a.) | Tenor |
|---|---|---|---|
Ujjivan Small Finance Bank |
8.25% |
8.25% |
12 months to 120 months |
YES BANK |
7.25% |
7.25% |
1 year to 10 years |
Note: The above interest rates are subject to change as per changes in the financial institution’s policies. These interest rates are as of 24th July 2024.
Here are some NRE account benefits you need to know about:
These accounts let you save your foreign income and easily convert it into Indian currency
You have the option to choose from a tenor of 1 to 10 years as per your goals and preferences
You can open an NRE fixed deposit account jointly with another Non-resident Indian
The principal and the interest amount that you earn on an NRE account is exempted from tax u/s 10 (4) of the Income Tax Act of 1961
You can transfer the principal and interest portion of your FD to your foreign account seamlessly
NRE account interest rates are typically higher than the interest rates you get on savings accounts
Some banks provide an overdraft or loan facility of up to a certain percentage of the value of the deposit
The Deposit Insurance and Credit Guarantee Corporation (DICGC) insures NRE fixed deposit accounts for a maximum amount of up to ₹5 Lakhs per depositor per bank
Here are some steps you may have to take to apply for a sweep-in FD:
Log in to your net banking account
Look for an FD Sweep-in option
Choose the savings or current account and fixed deposit account number that you plan to link to this facility
Select the option to activate the sweep-in facility on your fixed deposit account after completing any additional steps required by the bank
Note: The aforementioned steps are generic and the actual process may differ from one bank to another.
You also need to meet the eligibility criteria set by the financial institution to open an NRE account. While it varies across banks and NBFCs, here are the general criteria:
Residential Status: You must be a Non-resident Indian (NRI), a Person of Indian Origin (PIO), or have an Overseas Citizenship of India (OCI)
Currency of Deposition: You need to make the deposits in a foreign currency
Power of Attorney: The power of attorney must be with an Indian resident
Like many financial products and services, NRE accounts also come with certain disadvantages. Here are some of them:
You cannot use these accounts to deposit the money that you earn as an NRI in India. Instead, you need to open an NRO account for this purpose.
You cannot keep funds in any foreign currency as the funds deposited in NRE accounts are converted to Indian Rupees.
Reviewer
Many financial institutions in India provide high NRE fixed deposit rates. To get the best returns, research and compare the rates that various institutions offer.
An NRE FD is a secure option for depositing the funds you earned in a foreign country. Additionally, the interest you earn is exempt from tax.
Yes, there is no restriction on opening and maintaining more than one NRE account in India.
Yes, most financial institutions allow you to close your NRE FD accounts whenever required. However, some institutions may levy a small penalty for early withdrawals.
As per the Income Tax Act of 1961, the interest that you earn on an NRO FD is taxed at a 30% rate. However, an NRE FD does not incur any tax on the principal or interest income.
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