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Best Fixed Deposit Rates for NRE
For Non-Resident Indians (NRIs) looking to grow their wealth, NRE Fixed Deposits (FDs) present a secure and tax-free investment opportunity. With competitive NRE FD interest rates for UAE residents, you can earn attractive returns while keeping their investments repatriable. This article will help ...read more
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Qualified Policybazaar expert will assist you What is an NRE Fixed Deposit?
An NRE (Non-Resident External) FD is a fixed deposit account where NRIs can deposit their foreign earnings in Indian Rupees. The principal and interest you earn on these deposits are fully tax-free in India. These deposits offer higher security and guaranteed returns, making them an attractive option for NRIs.
Best NRE Fixed Deposit Rates for UAE 2025
Here is a comparison of the highest fixed deposit rates for NRE accounts offered by various Indian banks —
| Bank Name | 1 Year | 1 - 3 Years | 3 - 5 Years | 5 - 10 Years |
|---|---|---|---|---|
| Kotak Mahindra Bank | 7.10% | 7.15% | 7.00% | 6.20% |
| SBI Bank | 6.80% | 6.80% | 6.50% | 6.50% |
| State Bank of India | 6.80% | 7.00% | 6.75% | 6.50% |
| ICICI Bank | 6.70% | 7.00% | 7.00% | 6.90% |
| Axis Bank | 6.70% | 7.10% | 7.10% | 7.00% |
| Bank of Baroda | 6.85% | 7.15% | 6.80% | 6.50% |
| Canara Bank | 6.85% | 7.30% | 7.40% | 6.70% |
| HDFC Bank | 6.60% | 7.00% | 7.00% | 7.00% |
| Union Bank of India | 6.80% | 7.30% | 6.50% | 6.50% |
| Punjab National Bank | 6.80% | 7.00% | 6.50% | 6.50% |
Note: Interest rates may vary. We advise you to check with the respective banks for the latest updates.
Eligibility Criteria To Open NRE Fixed Deposits Account
To open an NRE FD account, you may need to meet the following criteria-
- Must be an NRI (Non-Resident Indian) or PIO (Person of Indian Origin)
- Should have an NRE Savings Account with an Indian bank
- Funds should be remitted from overseas earnings
Key Features of NRE Fixed Deposits
We have mentioned the key features of NRE fixed deposits account that you should be familiar with —
- Flexible Tenure: You can choose the term between 1 and 10 years based on your investment goals.
- Higher Interest Rates: You can earn better returns compared to regular savings accounts.
- Tax-Free Returns: Interest earned is 100% tax-free in India, maximising your earnings.
- Deposit Currency: Your deposits should be made in Indian Rupees, protecting you against exchange rate fluctuations.
- Loan Facility: NRIs can avail up to 95% overdraft or loan against NRE FDs.
- Repatriability: Both principal and interest can be freely repatriated to the NRIs overseas account.
- Auto-Renewal: Many banks allow you to automatically renew the FD upon maturity.
- Insurance Coverage: You get covered up to Rs 5 lakh under DICGC for added security.
- Nomination Facility: Investors can nominate a beneficiary to ensure easy fund transfer.
- Liquidity Options: Premature withdrawal available in case of emergencies.
NRE vs. NRO Fixed Deposits
|
Feature |
NRE FD |
NRO FD |
|---|---|---|
|
Source of Funds |
Foreign earnings |
Income earned in India |
|
Taxability |
Tax-free |
Taxable |
|
Repatriation |
Fully repatriable |
Partially repatriable |
|
Joint Account |
Allowed with another NRI |
Allowed with both NRIs and residents |
|
Interest Rates |
Competitive |
Varies across banks |
How to Open an NRE Fixed Deposit?
To open an account for NRE FD for UAE residents, follow these simple steps —
1. Choose a bank that offers the best NRE FD rates and terms
2. Prepare necessary documents, including —
- Passport and valid visa
- Proof of NRI status
- Address proof
- Existing NRE savings account details
3. Fund the deposit by transferring money from your foreign income
4. Select tenure and amount to suit your financial goals
5. Confirm the deposit and receive account details
Most banks allow NRIs to complete the process online or through their UAE representative offices.
Frequently Asked Questions
What is the meaning of an NRE deposit?
An NRE (Non-Resident External) deposit is a type of deposit specifically designed for Non-Resident Indians (NRIs). In this account, NRIs can deposit funds in Indian rupees that are transferred from their foreign earnings or income.
Which bank gives the highest NRE FD rates?
Interest rates vary across banks. But as of 2024, HDFC, Kotak Mahindra Bank, and Canara Bank are offering some of the highest NRE FD rates, going up to 7.50%.
Is NRE FD a good investment?
Yes, an NRE FD is an excellent investment for NRIs due to its tax-free interest, high security, and full repatriability of funds. It offers better returns than regular savings accounts and ensures easy fund transfers.
Can we do a fixed deposit in an NRE account?
Yes, NRIs can open a fixed deposit under their NRE account and earn competitive interest rates while enjoying full tax exemptions in India.
What is the minimum tenure for an NRE deposit?
You will need to complete the minimum tenure of a year to withdraw your FD amount.
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