Fixed Deposits are a simple and secure investment option that innumerable investors rely on for wealth creation. You make a one-time lumpsum investment at a fixed interest rate for a specific tenure. Your investment keeps earning you reasonable, guaranteed returns until its maturity. You can either receive your internet earnings periodically or have them added to your principal sum and opt for a lumpsum payout.
Anyone can invest in FDs. Suppose you are a non-resident Indian or an Overseas Citizen of India, or a Person of Indian Origin, you can invest in this option with NRI Fixed Deposit. There are three types: Non-Resident Ordinary, Non-Resident External, and Foreign Currency Non-Resident.
If you plan to invest in NRO FDs, you will have some queries. The following questions should answer all of them.
- How is investing in NRO FDs beneficial?
While you may be living overseas, you can hold assets and investments in India. This includes rental property, Mutual Funds, or pension. Typically, you would deposit your income from such sources in your Bank Account. However, this does no good. Instead, you should channel your income from regular sources in India to NRO Fixed Deposit. It keeps your money secure and makes it work by earning you a competitive interest rate.
- What is the minimum and maximum investment tenure?
You can invest in NRO FDs for a minimum period of a year and a maximum tenure of 10 years. You should consider your financial requirements to decide on a suitable tenure for investment. Generally, invest for a longer tenure as it increases your interest earnings. The best part about FDs is that it is nowhere linked to market standing. Hence, even if you invest for a longer tenure, you do not risk your hard-earned money.
- What are the tax implications associated with NRO FDs?
As mentioned, you earn a competitive interest rate on your deposit. These interest earnings are taxable by law. They get added to your taxable income and taxed according to the slab you fall under. When investing in NRO Deposit, you should check the applicability of DTAA. If it applies to your investment, you are saved from paying double taxes on your investment returns.
- Is it possible to repatriate your money?
As an NRI investor, repatriation should be your primary concern when making any financial commitment in India. With NRO FDs, you enjoy partial repatriation.
- How can you invest in NRO FDs?
Investing in NRO FDs are simple and can be done offline or online. The process further simplifies if you have an NRO Account with your chosen bank. You can opt for the best scheme within minutes through Online Banking channels.