Reserve Bank of India released external debt statistics for the financial year 2019 that showed total NRI deposits for the year was worth $130.4 billion. Out of which, $94 billion worth fixed deposits were due for maturity this year. Subsequently, the contribution of NRI deposits reached 72% in March 2019 up from 51% in March 2015.
Above figures clearly depict NRI’s interest in investing in fixed deposit accounts. Further, such individuals need to look for best NRI account plans and make sure to invest in one which is beneficial in terms of return and safe.
How to apply for NRI fixed deposit account?
Non-Resident Indians (NRIs) have to meet certain pre-requisites to invest in a fixed deposit account and secure their savings while gaining higher returns. NRIs need an NRO (Non-Resident Ordinary) account to be able to invest in a savings scheme. NRO accounts are a must for NRIs who have other sources of income in India.
Subsequently, NRIs can invest their savings on a fixed deposit scheme by following these 5 simple steps as mentioned below.
- Browse to the official website of the chosen financial company that offers higher returns on investment. Fill up the online application form as present on the website.
- As the following step, deposit the investment amount via NEFT, RTGS, cheque, or net banking.
- The investor should download the duly filled form for the best NRI account by clicking on the ‘Save as PDF’ button. Financial companies may ask individuals to upload copies of the document; in other cases, representatives of the financial company may visit for the collection of documents.
- In case the documents need to be collected from the communication address, the downloaded application form should be kept ready. Individuals need to print and sign it and affix photographs in place. Along with the form, they should keep the KYC documents ready for collection by company representatives.
- Post submission of documents and confirmation from the financial company’s representative, they can be assured that their FD is booked.
Following the steps mentioned above will help individuals to open a FD (fixed deposit) online. Once created, they will receive the required documents for their term deposit.
NRIs can consider opting for Fixed Deposits offered by Bajaj Finance to benefit from interest rates as high 8.35% as well as CRISIL and ICRA rated guarantees on the returns.
Considerations for NRIs before investing in FDs
Deposit from NRO account
Investors depositing funds for their fixed deposit account must have an NRO account from which the funds are transferred at the time of deposit.
Mandatory to provide PAN card
Non-resident Indians must provide PAN card at the time of investment. Since an NRI is investing in India, this income is taxable and needs to be recorded, and PAN serves the purpose. Further, TDS is applicable for NRIs as well while investing in fixed deposits and not providing PAN card can cause one more financial loss.
Double Taxation Avoidance Agreement (DTAA)
NRIs who earn in India and abroad may have to face a situation wherein they have to pay taxes in India and another international country as well as some countries levy taxes on globally earned income. They can evade from paying taxes twice in a financial year under DTAA for their investment in fixed deposits in India.
TDS on fixed deposits
Tax is deducted at source for NRI investors as well as their income is taxable in India. Further, individuals are entitled to TDS on FD as per the rates specified by the Income-tax department.
Use the NRI fixed deposit calculator
Before investing in a fixed deposit account, individuals need to calculate the returns they will receive out of the investment plan. Since the returns here are fixed, investors can first calculate them and then invest in a plan that seems more suitable to their financial need.
Investors can calculate the maturity amount receivable and interest pay-out at the end of tenor by knowing how to use a fixed deposit calculator. Non-Resident Indians will be able to make better financial decisions with this as a financial tool.
Subsequently, individuals will be able to make use of the steps mentioned above to complete the application procedure for best NRI account fixed deposits.
