What is an FCNR deposit?
FCNR (Foreign Currency Non-Resident) deposits let you deposit money in Indian banks in foreign currency (USD, GBP, EUR, JPY, AUD, CAD) at fixed interest rates. The deposit, interest, and principal are all in the original foreign currency — no rupee conversion risk.
2026 FCNR deposit rates (indicative)
| Bank | USD rate | GBP rate | EUR rate | Term |
|---|---|---|---|---|
| HDFC | 4.75-5.25% | 4.50-5.00% | 3.00-3.50% | 1-5 years |
| ICICI | 4.75-5.10% | 4.25-4.75% | 2.75-3.25% | 1-5 years |
| SBI | 4.50-5.00% | 4.00-4.50% | 2.50-3.00% | 1-5 years |
*(Rates change frequently. Check the bank's website for current rates.)*
FCNR vs US HYSA comparison
Transfer money internationally with real mid-market rates and low fees. Trusted by 16M+ customers.
Send Money with Wise →
| Feature | FCNR (USD) | US HYSA (SoFi, Ally) |
|---|---|---|
| 2026 rate (approx) | 4.75-5.25% | 4.50-5.00% |
| Currency risk | None (stays in USD) | None (stays in USD) |
| Taxable in India? | Interest tax-free (RNOR/NRI status) | Not applicable |
| Taxable in US? | Yes (US tax on worldwide income) | Yes |
| Min deposit | $1,000 | $0 |
| Lock-in | Yes (1-5 year fixed term) | No |
| FDIC equivalent | Not FDIC. Indian bank deposit insurance (₹5 lakh) | FDIC insured ($250K) |
Who should use FCNR?
Good for you if:
- You've returned to India (or plan to) and want to keep savings in USD
- You want to earn 4-5% USD interest while maintaining Indian bank relationship
- You're in RNOR period — interest is India tax-free
- You want to hedge against rupee depreciation
Not ideal if:
- You're still in the US (just use a US HYSA — simpler, FDIC-insured)
- You need liquidity (FCNR is fixed-term, premature withdrawal penalties apply)
- Your USD savings are under $5,000 (not worth the complexity)
Tax treatment
During RNOR: FCNR interest is India-tax-free (foreign income). Pay US tax on it if you're still a US taxpayer.
After RNOR expires (ordinary resident): India taxes worldwide income including FCNR interest at slab rates. US taxes also apply if you remain a US person. DTAA may provide credits to avoid double taxation.
How to open FCNR
- Visit your Indian bank branch in India (or in the US at HDFC/ICICI US branches)
- Transfer USD from your US bank account to the bank's FCNR account number
- Provide Form A2 (for remittance compliance)
- Receive FCNR deposit receipt in USD
Most major Indian banks offer FCNR from abroad via their NRI banking portals. HDFC and ICICI have US presence.
Watch the returning to India video →
🌍 Get the Free Study Abroad Finance Checklist
The exact steps to set up your finances before you land — bank account, money transfers, SIM card, forex card & health insurance.
🔒 Free 5-page PDF. No spam. Unsubscribe anytime.