NRE (Non-Resident External) Fixed Deposits are one of the best investments for NRIs/PIOs/OCIs because of two reasons:
- The interest rate is on the higher side as compared to their country of residence and
- the interest earned on NRE FD is tax free in India
This post compares the best interest rates on NRE FDs.
Best NRE FD Rates:
The table below compares the interest rates offered on various NRE fixed and recurring deposits along with the penalty on pre-closure of FD/RD across 45 major banks in India.
Deutsche Bank offers the highest interest rate with 7.50% for 5 years NRE FD.
IDFC Bank, DCB Bank, The Ratnakar Bank, Lakshmi Vilas Bank and Tamilnad Mercantile Bank offer highest interest rate across most tenures.
| Banks | 1 Years | 2 Years | 3 Years | 4 Years | 5 Years | 5+ Years | Penalty |
| Allahabad Bank | 6.60% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | 1% |
| Andhra Bank | 6.50% | 6.50% | 6.25% | 6.25% | 6.25% | 6.25% | 1% |
| Axis Bank | 6.75% | 6.90% | 6.90% | 6.90% | 6.90% | 6.90% | No Penalty |
| Bandhan Bank | 7.00% | 7.00% | 6.80% | 6.80% | 6.80% | 6.40% | 1% |
| Bank of Baroda | 6.60% | 6.60% | 6.70% | 6.70% | 6.70% | 6.60% | 1% |
| Bank of India | 6.60% | 6.50% | 6.50% | 6.30% | 6.30% | 6.25% | No Penalty |
| Bank of Maharashtra | 6.50% | 6.25% | 6.25% | 6.00% | 6.00% | 6.00% | 1% |
| Canara Bank | 6.50% | 6.45% | 6.20% | 6.20% | 6.20% | 6.00% | 1% |
| Catholic Syrian Bank | 6.50% | 6.50% | 6.75% | 6.50% | 6.50% | 6.50% | No Penalty |
| Central Bank of India | 6.60% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | No Penalty |
| Citibank | 5.00% | 5.00% | 5.75% | NA | NA | NA | 1% |
| City Union Bank | 7.10% | 7.10% | 7.10% | 7.10% | 7.10% | 6.70% | 1% |
| Corporation Bank | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | 1% |
| DCB Bank | 7.00% | 7.15% | 7.25% | 7.20% | 7.20% | 7.20% | No Penalty |
| Dena Bank | 6.50% | 6.50% | 6.25% | 6.25% | 6.30% | 6.30% | No Penalty |
| Deutsche Bank | 6.00% | 7.25% | 6.90% | 7.00% | 7.50% | NA | 1% |
| Dhanalakshmi Bank | 6.60% | 6.60% | 6.50% | 6.50% | 6.50% | 6.50% | No Info |
| Federal Bank | 6.70% | 7.10% | 6.50% | 6.50% | 6.50% | 6.50% | 1% |
| HDFC Bank | 6.75% | 6.25% | 6.00% | 6.00% | 6.00% | 6.00% | 1% |
| ICICI Bank | 6.60% | 6.75% | 6.50% | 6.50% | 6.50% | 6.50% | 1% |
| IDBI Bank | 6.75% | 6.50% | 6.50% | 6.50% | 6.50% | 6.00% | No Penalty |
| IDFC Bank | 7.00% | 7.25% | 7.25% | 7.20% | 7.20% | 7.20% | No Info |
| Indian Bank | 6.50% | 6.25% | 6.25% | 6.00% | 6.00% | 6.00% | No Penalty |
| Indian Overseas Bank | 6.75% | 6.50% | 6.25% | 6.00% | 6.00% | 6.00% | 1% |
| Indus Ind Bank | 7.00% | 6.80% | 6.80% | 6.50% | 6.50% | 6.50% | 1% |
| J&K Bank | 7.00% | 6.50% | 6.50% | 6.25% | 6.25% | 6.25% | 1% |
| Karnataka Bank | 7.10% | 7.10% | 6.50% | 6.50% | 6.50% | 6.50% | No Penalty |
| Karur Vysya Bank | 6.75% | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% | 1% |
| Kotak Mahindra Bank | 6.85% | 6.80% | 6.70% | 6.50% | 6.50% | 6.25% | 1% |
| Lakshmi Vilas Bank | 7.20% | 7.25% | 7.15% | 7.15% | 7.15% | 7.15% | No Penalty |
| Oriental Bank of Commerce | 6.60% | 6.50% | 6.50% | 6.40% | 6.40% | 6.40% | No Info |
| Punjab and Sind Bank | 6.75% | 6.75% | 6.60% | 6.55% | 6.55% | 6.55% | 1% |
| Punjab National Bank | 6.60% | 6.75% | 6.75% | 6.25% | 6.25% | 6.25% | No Info |
| Ratnakar Bank | 7.25% | 7.25% | 7.25% | 7.15% | 7.15% | 7.15% | No Info |
| South Indian Bank | 6.75% | 7.10% | 6.50% | 6.50% | 6.50% | 6.50% | No Penalty |
| Standard Charted Bank | 6.90% | 7.00% | 6.50% | 6.50% | 6.50% | NA | 1% |
| State Bank of India | 6.40% | 6.60% | 6.70% | 6.70% | 6.75% | 6.75% | No Penalty |
| Syndicate Bank | 6.75% | 6.75% | 6.60% | 6.60% | 6.60% | 6.50% | No Penalty |
| Tamilnad Mercantile Bank | 7.00% | 7.00% | 7.00% | 6.90% | 6.90% | 6.90% | 1% |
| UCO Bank | 6.50% | 6.50% | 6.40% | 6.25% | 6.25% | 6.25% | 1% |
| Union Bank of India | 6.75% | 6.50% | 6.50% | 6.50% | 6.50% | 6.50% | No Penalty |
| United Bank of India | 6.10% | 6.00% | 6.00% | 6.00% | 6.00% | 6.00% | 1% |
| Vijaya Bank | 6.50% | 6.60% | 6.50% | 6.50% | 6.50% | 6.25% | No Info |
| Yes Bank | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% | 7.00% | No Penalty |
For comparing the best interest rates on fixed deposits over different duration of investment, we have it divided into following 3 slabs:
- FD for 1 to 2 years
- FD for 2 to 5 Years
- FD for 5 to 10 years
Also Read: 8 Mutual Funds that accept Investment from Canada/USA based NRIs
Interest Rate for NRE Fixed Deposit of 1 – 2 Years:
The highest interest rate is offered by IDFC Bank (366 days) at 7.50%.
| Bank | Description | Interest Rate |
| IDFC Bank | 366 days | 7.50% |
| Deutsche Bank | 1 Year to 2 Years | 7.25% |
| IDFC Bank | 361 – 1095 days | 7.25% |
| Karnataka Bank | 450 Days | 7.25% |
| Lakshmi Vilas Bank | 725 Days | 7.25% |
| Ratnakar Bank | 12 months to less than 24 months | 7.25% |
| Repco Bank | 1 Year & Above – 2 years | 7.25% |
| DCB Bank | 15 months to less than 24 months | 7.15% |
| Lakshmi Vilas Bank | 17 Months to less than 30 Months | 7.15% |
| City Union Bank | 365 days – 5 Years | 7.10% |
| Karnataka Bank | 1 year to 2 years | 7.10% |
| Lakshmi Vilas Bank | 1 Year to less than 17 months | 7.10% |
| South Indian Bank | 600 Days | 7.10% |
| Yes Bank | 18 Months 8 Days to 18 Months 18 Days | 7.10% |
| Bandhan Bank | 1 year to less than 2 years | 7.00% |
| DCB Bank | 6 months to less than 15 months | 7.00% |
| J&K Bank | 1 year to less than 2 years | 7.00% |
| Karur Vysya Bank | 2 years and above | 7.00% |
| Standard Charted Bank | 21 Months – 2 Years | 7.00% |
| Tamilnad Mercantile Bank | 1 Year to less than 3 Years | 7.00% |
| Yes Bank | 1 Year <= 10 years | 7.00% |
| Standard Charted Bank | 18 Months – 21 Months | 6.95% |
| Axis Bank | 17 months < 10 Years | 6.90% |
| Kotak Mahindra Bank | 390 Days (12 months 25 days) | 6.90% |
| Standard Charted Bank | 1 Year – 375 days | 6.90% |
| Indus Ind Bank | 1 Years to below 1 Years 2 Months | 6.85% |
| Kotak Mahindra Bank | 365 Days to 23 Months | 6.80% |
| Axis Bank | 1 Year < 17 months | 6.75% |
| Federal Bank | Above 1 year to 2 years | 6.75% |
| HDFC Bank | 1 year 1 day – 1 year 3 days | 6.75% |
| Indus Ind Bank | 1 Years 2 Months to below 2 Years | 6.75% |
| Punjab and Sind Bank | 1 Year – 2 Years | 6.75% |
| Punjab National Bank | 1 Year – 3 Years | 6.75% |
| South Indian Bank | 1 year to 2 years | 6.75% |
| Syndicate Bank | 1 year to 2 years | 6.75% |
| Union Bank of India | 10 Month to 14 Month | 6.75% |
| Bank of Baroda | Above 1 year to 400 days | 6.70% |
| Corporation Bank | 555 days only | 6.70% |
| Federal Bank | 1 year | 6.70% |
| Federal Bank | 15 Months | 6.70% |
| Kotak Mahindra Bank | 23 Months to less than 3 years | 6.70% |
| Bank of India | 1 Year & above to less than 2 Yrs | 6.60% |
| Central Bank of India | 1 yr to less than 2 yrs | 6.60% |
| Corporation Bank | 444 days only | 6.60% |
| Dhanalakshmi Bank | 1 Year and above upto & inclusive of 2 years | 6.60% |
| Oriental Bank of Commerce | 1 year to less than 2 year | 6.60% |
| State Bank of India | Government Bank Benchmark | 6.40% – 6.60% |
| ICICI Bank | Private Bank Benchmark | 6.60% – 6.75% |
Also Read: 21 Hidden Charges in Saving Bank Account
Interest Rate for NRE Fixed Deposit of 2 – 5 Years
The highest interest rate is offered by Deutsche Bank (5 Years) at 7.50%
| Bank | Description | Interest Rate |
| Deutsche Bank | 5 Years | 7.50% |
| DCB Bank | 24 months to 60 months | 7.25% |
| IDFC Bank | 361 – 1095 days | 7.25% |
| Ratnakar Bank | 24 months to less than 36 months | 7.25% |
| Yes Bank | 36 Months 10 Days to 36 Months 20 Days | 7.25% |
| Digibank by DBS | 2 years & 6 months | 7.20% |
| IDFC Bank | 3 years 1days – 10 years | 7.20% |
| Lakshmi Vilas Bank | 30 months to less than 36 months | 7.20% |
| Lakshmi Vilas Bank | 36 months to 120 months | 7.15% |
| Ratnakar Bank | 36 months to less than 240 months | 7.15% |
| City Union Bank | 365 days – 5 Years | 7.10% |
| Karur Vysya Bank | 2 years and above | 7.00% |
| Repco Bank | Above 2 years – 5 Years | 7.00% |
| Tamilnad Mercantile Bank | 1 Year to less than 3 Years | 7.00% |
| Yes Bank | 1 Year <= 10 years | 7.00% |
| Axis Bank | 17 months < 10 Years | 6.90% |
| Tamilnad Mercantile Bank | 3 Years & above | 6.90% |
| Bandhan Bank | 2 years to less than 5 years | 6.80% |
| Catholic Syrian Bank | 3 Years | 6.75% |
| Indus Ind Bank | 2 years to below 2 years 6 Months | 6.75% |
| Punjab National Bank | 1 Year – 3 Years | 6.75% |
| Kotak Mahindra Bank | 23 Months to less than 3 years | 6.70% |
| Syndicate Bank | Above 2 year & upto 5 years | 6.60% |
| Punjab and Sind Bank | Above 3 Year – 10 Years | 6.55% |
| State Bank of India | Government Bank Benchmark | 6.70% |
| ICICI Bank | Private Bank Benchmark | 6.50% |
Also Read: Which bank offers highest interest rate on savings account?
Interest Rate for NRE Fixed Deposit of 5 – 10 Years
The highest interest rate is offered by IDFC Bank (3 years 1 days – 10 years) and DCB Bank (More than 60 months to 120 months) at 7.20%.
| Bank | Description | Interest Rate |
| DCB Bank | More than 60 months to 120 months | 7.20% |
| IDFC Bank | 3 years 1days – 10 years | 7.20% |
| Lakshmi Vilas Bank | 36 months to 120 months | 7.15% |
| Ratnakar Bank | 36 months to less than 240 months | 7.15% |
| Karur Vysya Bank | 2 years and above | 7.00% |
| Yes Bank | 1 Year <= 10 years | 7.00% |
| Axis Bank | 17 months < 10 Years | 6.90% |
| Tamilnad Mercantile Bank | 3 Years & above | 6.90% |
| City Union Bank | Above 5 years & upto 10 years | 6.70% |
| State Bank of India | Government Bank Benchmark | 6.75% |
| ICICI Bank | Private Bank Benchmark | 6.50% |
Best NRE Fixed Deposit Interest Rates for NRIs – April 2018
NRE FD/RD – Rules:
Before you invest in NRE FDs you must be aware of following rules:
1. The minimum tenure for NRE FD/RD is 1 year (as per RBI Directives from July 17, 2003).
2. The maximum deposit tenure offered by most banks is 10 years.
3. The interest earned on NRE FD is tax free in India but it can be taxed in country of your residence. For e.g. USA taxes worldwide income and hence NRIs from USA may have to pay tax in USA.
4. NRE Fixed Deposit makes excellent investment opportunity for NRIs from lower or NO income tax countries like UAE, Singapore, etc.
Also Read: NRE Vs NRO – Which is the right account for NRIs?
5. The principal and interest from NRE FD/RD is freely repatriable.
6. Most banks offer higher interest rate on lower deposit amount (less than Rs 50 lakhs/1 crore). It makes sense to split your FD in multiple smaller FDs to get the highest interest rate.
NRE Fixed Deposit – Lower Interest on Higher Amount – Bank of Baroda Example
7. There is NO additional interest for Senior Citizens or bank staff for NRE deposits.
8. Premature closure of FD/RD is permitted for with some penalty on the interest (usually 1% lower interest than applicable rates). Some banks waive off this penalty. However there would be NO interest in case the NRE deposit remained invested for less than 1 year.
9. The interest is compounded quarterly for most banks
10. Only funds from overseas income (in foreign currency) can be deposited for NRE FD/RD account. The amount is converted to Indian Rupee on deposit.
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