Chennai : Karur Vysya Bank (KVB), one of India’s leading private sector banks with a legacy of over 110 years, has raised interest rates on its Foreign Currency Non-Resident (FCNR) deposits, giving Non-Resident Indians (NRIs) a way to earn higher returns on their foreign currency savings.
KVB is now offering 7.00% per annum on US Dollar (USD) FCNR deposits for tenures of three years and above, the highest rate on its FCNR ladder.
The scheme lets NRIs place their overseas savings for tenures of one to five years while holding the money in foreign currency, away from rupee movement.
Revised USD FCNR Deposit Rates
| Maturity Period | Interest Rate (% p.a.) |
| 1 Year and above but less than 2 Years | 5.00% |
| 2 Years and above but less than 3 Years | 3.66% |
| 3 Years and above but less than 4 Years | 7.00% |
| 4 Years and above but less than 5 Years | 7.00% |
| 5 Years | 7.00% |
Special terms for the 7.00% USD FCNR rate
The 7.00% rate applies to eligible USD FCNR deposits and carries a mandatory lock-in period of one year. No premature closure will be permitted during this period. After completion of one-year, premature closure may be allowed as per the Bank’s existing guidelines and interest will be paid at the applicable run period rate less 1% as per Bank’s Deposit Policy.
Key benefits for NRI customers
Tax-efficient returns: Interest earned on FCNR deposits is exempt from income tax in India under current tax rules. Both principal and interest are fully repatriable.
No rupee exchange risk: The deposit stays in foreign currency, so its value does not move with the Indian Rupee during the tenure.
Forward contract facility: Customers who plan to convert funds into Indian Rupees later can book a forward contract to lock in an exchange rate.
Loan against deposit: Customers can borrow against an FCNR deposit without breaking it, keeping funds intact while meeting a short-term need.
Smooth account transition: When a customer’s residential status changes, KVB moves the deposit and the relationship across without disruption.
Speaking on the revised rates, Shri B. Ramesh Babu, Managing Director & CEO of Karur Vysya Bank, said, “NRIs want their foreign currency savings to earn more without taking on rupee risk, and these rates answer that directly. A 7.00% return on a US Dollar deposit is a strong proposition, the interest is tax-free in India under current rules, and the principal stays fully repatriable. We expect good traction from the diaspora, particularly those who plan to bring funds back to India over the next few years.”
