According to a recent report, NRI deposits worth $94 billion are up for maturity out of the $130.4 billion worth term deposits existent in the financial year 2019-20. The constantly rising NRI investment options have changed the financial scenario as investors today are earning more returns courtesy smarter and easier investment options now available with them.
Non-resident Indians who have an accountable source of income in India need to make sure their hard-earned money is invested in the right place, ensuring safety and substantial returns together.
Further, NRIs need to have an NRO (non-resident ordinary) account to be able to save funds in India. This NRO account is used for transferring or depositing money in a fixed deposit account.
How to get better returns from NRI FD investments?
Other than looking for the highest FD rates in India, an NRI should also consider numerous other pointers before investing for guaranteed and safe returns as well as the flexibility to use the sum invested for emergencies.
- Choose a reliable financial company
Investors need to search and find a reliable financial company that offers higher returns. They can make compare the offered rate of interest before they opt to deposit their funds. It is always advisable to opt for a reputed financer irrespectively.
- Split into multiple FDs
Instead of investing in a single fixed deposit account for a substantial amount, individuals can split the amount and invest in multiple term-deposit schemes. Doing so can help investors in more ways than one, such as –
- Safeguarding funds from potentially risky investments.
- Helps reduce tax obligations.
- Gain higher returns with NRI investment in multiple FD accounts.
- Choose from varying tenor and plan their financial needs accordingly in advance.
Further, one can choose to invest in both cumulative and non-cumulative FDs so that they can save a lump sum amount while generating periodic interest from the deposits.
- Prefer cumulative FD over non-cumulative
Investors, pondering the benefits of cumulative vs. non-cumulative fixed deposit, should first understand their financial requirements. In case one is looking for periodic earnings, choosing a non-cumulative FD is better. On the other hand, if investors are keen to earn higher returns, investing in a cumulative FD is the optimal choice as the interest rate is compounded on the earned interest amount as well.
- Opt for auto-renewal
Those who plan to reinvest the amount should renew their FD through auto-renewal. Doing so ensures continuous interest earnings on the invested sum. Further, this automatic renewal procedure also saves time and reduces hassle for the NRI investor.
- Plan finances with an NRI FD calculator
Non-resident Indian investors should know how to use the fixed deposit calculator, as offered by financial companies. Using it, one can easily calculate expected returns before investing. The individual simply needs to choose the type of FD and input value for the deposit amount and tenor. The respective financial company offers its quote of interest rate, according to which one can calculate the maturity amount and interest payout for the term deposit.
- Choose a longer tenor
Individuals investing in NRI FDs can choose a longer tenor to increase their overall earnings from the deposit. Thus, apart from looking for the highest FD rates in India, one should also consider how the tenor affects those rates.
- Mandatory PAN submission
Individuals going for NRI investment need to provide a PAN card to the financial company because the income here is taxable. Failure to do so can lead to considerable charges on the investment returns. Thus, to keep earnings safe and secure, complete adherence to the rules is essential.
Subsequently, investors have to make sure they do not opt for pre-mature withdrawal as that will affect the amount of return in addition to the penalties charged. These pointers may help NRI investors save funds in India while generating substantial returns from it. Streamlining their financial investments will be easier with these tips as they would make more informed decisions. You can consider FDs offered by Bajaj Finance for the most competitive Fixed Deposit interest rates available in the Indian market of up to 8.10%.