To combat the growing inflation, the Reserve Bank of India (RBI) increased the repo rate by 90 basis points to 4.9 percent in the current fiscal year (100 basis points = 1 percentage point). Additionally, thus far in 2022, the rupee has lost value versus the US dollar by around 7.5%. Due to these two criteria, domestic fixed deposit investments have become really attractive. For certain investment tenures, some banks, notably State Bank of India (SBI), Bank of Baroda, and IDBI Bank, have raised their interest rates on NRO deposits.
Non-Resident Ordinary (NRO) bank accounts are kept open by Non-Resident Indians (NRIs). An NRI can use this account to handle her income from sources such as rents, dividends, salaries and other sources generated in India. An NRI may deposit funds into this account in both foreign and Indian rupees but withdraw funds only in Indian currency. The NRO savings account’s excess money should be placed in NRO fixed deposits. According to information gathered by BankBazaar, the following private banks provide interest rates up to 6.60 percent on NRO deposits with terms of two to three years.
On 2-3 year FDs, DCB Bank provides an interest rate of 6.60 percent annually. This private bank provides the best rate available. In two years, an investment of Rs. 1 lakh will increase to Rs. 1.14 lakh.
On 2-3 year FDs, Bandhan Bank, IndusInd Bank, RBL Bank, and YES Bank all provide 6.50 percent interest annually. In two years, an investment of Rs. 1 lakh will increase to Rs. 1.14 lakh. The minimum investment necessary for YES Bank’s FD is Rs 10,000.
On FDs between two and three years, IDFC First Bank pays 6.25 percent interest annually. In two years, an investment of Rs. 1 lakh will increase to Rs. 1.13 lakh.
On FDs between two and three years, Kotak Mahindra Bank gives an interest rate of 5.90 percent annually. In two years, an investment of Rs. 1 lakh will increase to Rs. 1.12 lakh. Rs. 50,000 is the minimum investment required.
On 2-3 year FDs, Federal Bank provides an annual interest rate of 5.85 percent. In two years, an investment of Rs. 1 lakh will increase to Rs. 1.12 lakh.
Greater interest rates are being offered by new and smaller private banks to attract further deposits. Fixed deposit investments up to Rs 5 lakh are insured by the Deposit Insurance and Credit Guarantee Corporation (DICGC), a subsidiary of the RBI.
The information on fixed deposits is currently as of July 13, 2022, according to some credible websites. For the purpose of compiling statistics, interest rates on NRO deposit up to Rs 2 crore with terms of two to three years have been taken into consideration for all private banks that are listed on the BSE. Banks without access to reliable data have not been taken into account. Quarterly compounding is taken for granted in all FDs.