Federal Bank launches FCNR deposit at 6.25% interest rate to tap NRI investment demand
ADVERTISEMENT
Federal Bank has introduced a new foreign currency deposit scheme for non-resident Indians (NRIs), offering an interest rate of 6.25% per annum on US dollar-denominated deposits with tenures ranging from three to five years.
The private sector lender said the product, named FCNR Max Deposit Scheme, has been launched in response to growing demand from overseas Indian customers seeking higher-yield investment avenues while maintaining exposure to foreign currency deposits. The scheme comes at a time when banks are looking to strengthen their NRI deposit base amid evolving global interest rate dynamics.
Focus on NRI deposit mobilisation
Under the scheme, customers can place Foreign Currency Non-Resident (FCNR) deposits in US dollars and earn a fixed annual return of 6.25% for deposit tenures between three and five years. The bank said the product is designed to offer stable returns while retaining the safety associated with bank deposits.
Federal Bank's NRI business remains a key component of its liability franchise, supported by its overseas presence through representative offices in Dubai and Abu Dhabi and its International Financial Services Centre Banking Unit at GIFT City.
Commenting on the launch, Joy P. V., Country Head – Retail Liabilities at Federal Bank, said the lender remains focused on providing customer-centric financial solutions for its NRI clientele.
"The FCNR Max Deposit Scheme reflects Federal Bank's focus on delivering both value and reliability in foreign currency investments," he said.
Premature withdrawal conditions
The FCNR Max Deposit Scheme carries a lock-in period of one year from the date of opening. Deposits withdrawn after the completion of the lock-in period but before maturity will attract a lower payout, with interest being paid at a rate 1% below the applicable rate for the actual period for which the deposit remained with the bank.
The launch adds to Federal Bank's suite of NRI-focused products as competition among lenders intensifies for overseas deposits. As of March 31, 2026, Federal Bank reported a total business mix, comprising deposits and advances, of ₹5.78 lakh crore. The lender operates a network of more than 1,600 banking outlets across India, supported by digital banking channels serving customers in domestic and international markets.