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India Tops the List for Cash Deposits for NRI's
SI Team
Friday, August 7, 2015
With the Euro zone taking a hit because of the Greek debt crisis, reports point out that NRI's are looking at the domestic market for cash deposits. Deposit flow has doubled compared to the same period in last financial year with the figures standing at $4.6 billion and $2.5 billion respectively with Kerala topping the charts according to Reserve Bank of India. N.S. Venkatesh, the Executive Director of IDBI is of the view that there has been a surge in NRI deposits because of the interest rates that the Indian banks are offering against the negative returns in the Euro Zone. While Jose Skaria, AGM of Federal Bank has observed that customers belonging to the higher income slab are increasingly investing money in stock markets. As for customers belonging to the middle and lower income category, they are still favoring bank deposits with liquidity and safety elements.
There are three segments to NRI deposits- foreign currency non-resident or FNCR, non-resident ordinary or NRO, and non-resident external or NRE. AS per the RBI data, NRI deposits worth $14 billion were deposited with NRE accounting for $12.1 billion in 2014-15. Interestingly when the figures are compared with the 2013-14 financial year, it stood at $38.4 billion. This sharp rise was witnessed because one could swap dollars on FNCR deposits on grounds attracting foreign currency in order to control the value of the rupee.

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