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Latest NRE Fixed Deposit Interest Rates – 2017


nre-fd-rates

Compares the best interest rates on NRE FDs along with pre-closure penalty. Deutsche Bank offers the highest interest rate with 8% for 5 years NRE FD.

NRE (Non-Resident External) Fixed Deposits are one of the best investments for NRIs/PIOs/OCIs because of two reasons:

  1. The interest rate is on the higher side as compared to their country of residence and
  2. the interest earned on NRE FD is tax free in India

We compares the best interest rates on NRE FDs.

Best NRE FD Rates:

The table below compares the interest rates offered on various NRE fixed and recurring deposits along with the penalty on pre-closure of FD/RD across 45 major banks in India.

Deutsche Bank offers the highest interest rate with 8% for 5 years NRE FD.

DCB Bank, The Ratnakar Bank and Yes Bank offer highest interest rate across most tenures.

Banks 1 Year  2 Years 3 Years 4 Years 5 Years 5+ Years Penalty for

 Premature Closure

Allahabad Bank 7.00% 6.75% 6.50% 6.50% 6.50% 6.50% 1.00%
Andhra Bank 7.00% 7.00% 6.50% 6.50% 6.50% 6.50% 1.00%
Axis Bank 7.00% 7.10% 6.75% 6.75% 6.75% 6.75% No Penalty
Bandhan Bank 7.50% 7.25% 6.90% 6.90% 6.90% 6.50% 1.00%
Bank of Baroda 7.00% 7.00% 6.85% 6.50% 6.50% 6.50% 1.00%
Bank of India 7.00% 6.85% 6.85% 6.70% 6.70% 6.70% No Penalty
Bank of Maharashtra 6.25% 6.25% 6.25% 6.00% 6.00% 6.00% 1.00%
Canara Bank 6.90% 6.90% 6.90% 6.90% 6.90% 6.90% 1.00%
Catholic Syrian Bank 6.50% 6.50% 6.75% 6.50% 6.50% 6.50% No Penalty
Central Bank of India 7.00% 7.00% 6.90% 6.90% 6.90% 6.90% No Penalty
Citibank 5.00% 5.00% 5.00% 5.00% 5.00% 5.00% 1.00%
City Union Bank 7.10% 6.85% 6.85% 6.85% 6.85% 6.70% 1.00%
Corporation Bank 6.90% 6.90% 6.80% 6.80% 6.80% 6.80% 1.00%
DCB Bank 7.00% 7.10% 7.20% 7.25% 7.25% 7.20% No Penalty
Dena Bank 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% No Penalty
Deutsche Bank 6.00% 6.90% 7.00% 7.25% 8.00% NA 1.00%
Dhanalakshmi Bank 6.75% 6.50% 6.50% 6.50% 6.50% 6.50% No Info
Federal Bank 6.70% 6.80% 6.50% 6.50% 6.50% 6.50% 1.00%
HDFC Bank 6.95% 6.25% 6.00% 6.00% 6.00% 6.00% 1.00%
ICICI Bank 6.90% 7.00% 6.75% 6.75% 6.75% 6.50% 1.00%
IDBI Bank 6.90% 6.90% 6.75% 6.75% 6.75% 6.75% No Penalty
Indian Bank 6.50% 6.25% 6.25% 6.00% 6.00% 6.00% No Penalty
Indian Overseas Bank 6.75% 6.50% 6.25% 6.00% 6.00% 6.00% 1.00%
Indus Ind Bank 7.15% 7.05% 6.75% 6.75% 6.75% 6.75% 1.00%
J&K Bank 6.75% 6.75% 6.75% 6.75% 6.75% 6.75% 1.00%
Karnataka Bank 6.75% 6.75% 6.50% 6.50% 6.50% 6.50% No Penalty
Karur Vysya Bank 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 1.00%
Kotak Mahindra Bank 6.90% 6.25% 6.25% 6.25% 6.25% 6.00% 0.50%
Lakshmi Vilas Bank 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% No Penalty
Oriental Bank of Commerce 7.00% 6.75% 6.75% 6.50% 6.75% 6.75% No Info
Punjab and Sind Bank 7.00% 7.00% 7.00% 7.00% 7.00% NA 1.00%
Punjab National Bank 7.00% 6.90% 6.90% 6.90% 6.90% 6.70% No Info
South Indian Bank 6.75% 6.75% 6.50% 6.50% 6.50% 6.50% No Penalty
Standard Charted Bank 7.00% 7.00% 7.00% 7.00% 7.00% NA 1.00%
State Bank of India 6.90% 6.75% 6.75% 6.50% 6.50% 6.50% No Penalty
Syndicate Bank 6.80% 6.50% 6.50% 6.50% 6.50% 6.00% No Penalty
Tamilnad Mercantile Bank 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 1.00%
The Ratnakar Bank 7.50% 7.65% 7.65% 7.50% 7.50% 7.50% 1.00%
UCO Bank 7.00% 6.90% 6.90% 6.75% 6.75% 6.75% 1.00%
Union Bank of India 7.00% 6.80% 6.80% 6.80% 6.80% 6.80% No Penalty
United Bank of India 6.50% 6.25% 6.25% 6.25% 6.25% 6.25% 1.00%
Vijaya Bank 6.50% 6.50% 6.50% 6.50% 6.50% 6.25% No Info
Yes Bank 7.10% 7.15% 7.20% 7.10% 7.10% 7.10% No Penalty

For comparing the best interest rates on fixed deposits over different duration of investment, we have it divided into following 3 slabs:

  • FD for 1 to 2 years
  • FD for 2 to 5 Years
  • FD for 5 to 10 years

Interest Rate for NRE Fixed Deposit of 1 – 2 Years:

The highest interest rate is offered by The Ratnakar Bank (24 months to less than 36 months) at 7.65%.

Bank Description Interest Rate
The Ratnakar Bank 24 months to less than 36 months 7.65%
Bandhan Bank 1 Year 7.50%
The Ratnakar Bank 12 months to less than 24 months 7.50%
Standard Charted Bank 1 year – 390 days 7.25%
Indus Ind Bank 1 Years to below 1 Years 2 Months 7.15%
Yes Bank 18 Months 8 Days to 18 Months 18 Days 7.15%
Axis Bank 14 months < 15 months 7.10%
City Union Bank 1 year 7.10%
DCB Bank 18 months to less than 24 months 7.10%
Punjab and Sind Bank 1 Year – 2 Year 7.10%
Yes Bank 1 Years to <= 10 years 7.10%
Indus Ind Bank 1 Years 2 Months to below 2 Years 7.05%
State Bank of India Government Bank Benchmark 6.75% – 6.90%
ICICI Bank Private Bank Benchmark 6.90% – 7.00%

Interest Rate for NRE Fixed Deposit of 2 – 5 Years

The highest interest rate is offered by Deutsche Bank (5 Years) at 8.00%

Bank Description Interest Rate
Deutsche Bank 5 Years 8.00%
The Ratnakar Bank 36 months to less than 240 months 7.50%
Deutsche Bank 4 years to 5 Years 7.25%
DCB Bank 24 months to 36 months 7.20%
IDFC Bank 732 – 1095 days 7.20%
Yes Bank 36 Months 10 Days to 36 Months 20 Days 7.20%
Yes Bank 1 Years to <= 10 years 7.10%
State Bank of India Government Bank Benchmark 6.50% – 6.75%
ICICI Bank Private Bank Benchmark 6.75%

Interest Rate for NRE Fixed Deposit of 5 – 10 Years

The highest interest rate is offered by The Ratnakar Bank (36 months to less than 240 months) at 7.50%.

Bank Description Interest Rate
The Ratnakar Bank 36 months to less than 240 months 7.50%
DCB Bank More than 60 months to 120 months 7.20%
Yes Bank 1 Years to <= 10 years 7.10%
Dena Bank 5 years to less than 10 years 7.00%
Karur Vysya Bank 3 years and above 7.00%
Lakshmi Vilas Bank 5 years to 10 years 7.00%
Punjab and Sind Bank >5 Years – 10 Years 7.00%
Tamilnad Mercantile Bank Ltd Above 3 Years 7.00%
State Bank of India Government Bank Benchmark 6.50%
ICICI Bank Private Bank Benchmark 6.50%

NRE FD/RD – Rules:

Before you invest in NRE FDs you must be aware of following rules:

  1. The minimum tenure for NRE FD/RD is 1 year (as per RBI Directives from July 17, 2003).
  2. The maximum deposit tenure offered by most banks is 10 years.
  3. The interest earned on NRE FD is tax free in India but it can be taxed in country of your residence. For e.g. USA taxes worldwide income and hence NRIs from USA may have to pay tax in USA.
  4. NRE Fixed Deposit makes excellent investment opportunity for NRIs from lower or NO income tax countries like UAE, Singapore, etc.
  5. The principal and interest from NRE FD/RD is freely repatriable.
  6. Most banks offer higher interest rate on lower deposit amount (less than Rs 50 lakhs/1 crore). It makes sense to split your FD in multiple smaller FDs to get the highest interest rate.
    nre-fd-rates
    NRE Fixed Deposit – Lower Interest on Higher Amount – Bank of Baroda Example
  7. There is NO additional interest for Senior Citizens or bank staff for NRE deposits.
  8. Premature closure of FD/RD is permitted for with some penalty on the interest (usually 1% lower interest than applicable rates). Some banks waive off this penalty. However there would be NO interest in case the NRE deposit remained invested for less than 1 year.
  9. The interest is compounded quarterly for most banks
  10. Only funds from overseas income (in foreign currency) can be deposited for NRE FD/RD account. The amount is converted to Indian Rupee on deposit.

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