A recent data released by the Reserve Bank of India (RBI) showed an inflow of about $12 billion in non-resident Indian (NRI) deposit schemes in FY25 (April-October this year). This total amount of precisely $11.89 billion deposited by overseas Indians is close to double the amount ($6.11 billion) recorded in the same period last year.

The total outstanding therefore with regard to NRI deposits stood at $162.69 billion, as of October 2024. It was $143.48 billion around the same time last year. Over $1 billion was deposited in the various NRI schemes in October alone.

The NRI deposit schemes include foreign currency non-resident (FCNR) deposits, non-resident external (NRE) deposits, and non-resident ordinary (NRO) deposits.

The maximum flow was seen in FCNR (B) deposits, which amounted to about $6.1 billion; last year, it was $2.06 billion. This account, which is maintained in freely convertible foreign currency, allows customers to have a fixed deposit in India for a tenure of one to five years. The RBI recently raised the interest rate ceilings on deposits in this account, thereby facilitating banks with an additional avenue for raising funds in order to encourage dollar inflows.

During the April-October period, NRE deposits witnessed an inflow of $3.09 billion compared to $1.95 billion in the same period a year ago. This account is a high-return rupee deposit option for NRIs to invest their foreign income.

Substantial flows were noticed in NRO deposits also. From $2 billion last year, it was $2.66 billion this year. This rupee-denominated account allows NRIs, overseas citizens of India, and persons of Indian origin, to deposit income earned in the country. – editor@nrifocus.com