Non‑Resident External (NRE) FDs allow NRIs to deposit foreign earnings in India in rupees. Principal and interest are fully repatriable, and interest is tax‑free in India. Interest rates vary by bank and tenure. For example, Union Bank offers around 6.80 % for a 1‑year NRE FD and up to 7.30 % for 1 year 1 day to 3 years. Punjab National Bank provides 6.80 % for 1 year and up to 7.00 % for >1 year–3 years.
NRE FD Snapshot
| Bank | 1‑year rate | 1–3 years | 3–5 years | 5–10 years |
|---|---|---|---|---|
| Union Bank of India | 6.80 % | 6.40 %–7.30 % | 6.50 % | 6.50 % |
| Punjab National Bank | 6.80 % | 6.80 %–7.00 % | 6.50 % | 6.50 % |
| Canara Bank | 6.90 % | 6.90 %–7.00 % | 6.75 % | 6.75 % |
| IDBI Bank | 6.80 % | 6.80 %–7.10 % | 6.50 % | 6.50 % |
To open an NRE FD, one must be an NRI or Overseas Citizen of India (OCI) holding a valid passport. Funds must be transferred from abroad via normal banking channels. Compare rates and check if premature withdrawal is allowed, as some banks impose higher penalties on NRE deposits.
