The Best FCNR Account Interest Rates: A Guide

Uncover FCNR interest rates and maximise your savings
min read
May 24, 2024

For Non-Resident Indians (NRIs), FCNR (Foreign Currency Non-Resident) accounts offer a secure and flexible way to hold foreign currency deposits in India. One of the most critical factors when choosing an FCNR account is the interest rate, as it directly impacts the returns on your deposits.

Understanding FCNR account interest rates can help you maximise earnings and make informed financial decisions. 

In this blog, we’ll explore the best FCNR account interest rates, how they vary, and what factors influence them to ensure you get the most out of your investments.

What is an FCNR Account?

An FCNR (Foreign Currency Non-Resident) account is a term deposit account specifically designed for Non-Resident Indians (NRIs).

These accounts allow NRIs to hold their savings in foreign currencies, providing a secure and convenient way to manage their overseas earnings while benefiting from competitive interest rates.

Key Features of FCNR Accounts

  • Currency Options: FCNR accounts can be maintained in major foreign currencies such as USD, GBP, EUR, JPY, CAD, and AUD. This feature helps NRIs avoid the risks associated with currency exchange rate fluctuations.
  • Interest Rates: FCNR account interest rates are generally competitive and depend on the currency and tenure of the deposit. The interest earned is tax-free in India, making it an attractive option for NRIs.
  • Flexible Tenure: These accounts offer flexible deposit tenures, typically ranging from one to five years. This allows NRIs to choose a tenure that best suits their financial goals and needs.
  • Repatriability: The principal and interest earned in FCNR accounts are fully repatriable. This means that NRIs can transfer their funds back to their country of residence without restrictions.
  • Security: FCNR accounts are considered safe as they are regulated by the Reserve Bank of India (RBI) and offer protection against currency risks.

How to Find the Best FCNR Interest Rates?

Finding the best FCNR interest rates is crucial for maximising the returns on your foreign currency deposits. Here are some tips on how to research and compare FCNR deposit interest rates to ensure you get the best deal:

1. Research Major Banks

  • Compare Offers: Start by researching the FCNR account interest rates offered by major banks in India. Look for banks with a strong reputation and a history of offering competitive rates.
  • Check Online: Most banks publish their current FCNR deposit rates on their websites. Make a list of the rates offered for different currencies and tenures.

2.  Consider the Currency and Tenure

  • Currency-Specific Rates: FCNR account interest rates vary depending on the currency of the deposit. Rates for USD, GBP, EUR, JPY, CAD, and AUD can differ significantly. Identify which currency offers the best rate for your deposit.
  • Optimal Tenure: The tenure of your FCNR deposit also impacts the interest rate. Longer tenures typically offer higher rates, but it's essential to match the tenure with your financial goals and liquidity needs.

3.  Look for Special Offers and Promotions

  • Promotional Rates: Some banks offer promotional FCNR interest rates for new customers or deposits made during specific periods. Look for these offers to take advantage of higher rates.
  • Negotiation: Don't hesitate to negotiate with your bank, especially if you are making a large deposit. Banks may be willing to offer better rates to attract high-value customers.

4. Monitor Economic Trends

  • Interest Rate Trends: Stay informed about global economic trends and how they impact FCNR deposit rates. Central bank policies, inflation rates, and currency stability influence bank interest rates.
  • Regular Updates: FCNR interest rates can change based on economic conditions. Check the rates regularly to ensure you always get the best possible return on your deposits.


Securing the best FCNR account interest rates is crucial for maximising the returns on your foreign currency deposits. NRIs can make smart investment decisions by researching and comparing rates, considering currency and tenure options, and staying informed about economic trends.

FCNR accounts offer significant benefits, including competitive interest rates and tax-free earnings, making them an excellent choice for NRIs looking to grow their savings securely. Stay proactive and leverage these opportunities to ensure a stable financial future.


Q1. How does FCNR account interest rates compare among leading banks?

On average, FCNR account interest rates offered by leading banks tend to be competitive and often fall within 1% to 3% per annum. These rates can vary based on the currency chosen and the bank's prevailing policies. It's always advisable to check the latest rates offered by specific banks, as they can fluctuate over time.

Q2. What factors influence the interest rates offered on FCNR accounts?

The interest rates on FCNR accounts are influenced by factors such as the currency of the deposit, the tenure of the deposit, current economic conditions, and central bank policies. Bank-specific factors and promotional offers also play a role.

Q3. Can the interest rates on FCNR accounts change after the account is opened?

No, the interest rates on FCNR accounts are fixed for the tenure of the deposit. Once the account is opened, the agreed-upon interest rate remains unchanged until the deposit matures.

Q4. What are the tax implications for the interest earned on FCNR accounts?

The interest earned on FCNR accounts is tax-free in India. However, NRIs should check the tax regulations in their country of residence, as there may be additional tax implications on the interest earned.

Q5. How often is the interest on FCNR accounts compounded?

Interest on FCNR accounts is typically compounded annually. The compounding frequency may vary depending on the bank's policies, so it is advisable to confirm with the specific bank.

Q6. In which currencies can you open an FCNR account, and how do currency choices affect interest rates?

FCNR accounts can be opened in major foreign currencies such as USD, GBP, EUR, JPY, CAD, and AUD. The choice of currency affects the interest rates, as different currencies may have different rates based on economic conditions and market demand.

Q7. What minimum deposit is required to open an FCNR account and earn interest?

The minimum deposit required to open an FCNR account varies by bank but typically ranges from $1,000 to $10,000 or the equivalent in other foreign currencies. It's important to check with the specific bank for their minimum deposit requirements.

Rupali enjoys writing about everything related to money (in India and around the world). A MICA graduate in Communications, she has over seven years of experience in content creation and communication strategy for various user touchpoints, from CRM to UX for apps and websites, especially in fintech and healthcare. Outside of work, you'll find her binging on true crime documentaries or cooking up a storm.

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