Top of main content

FCNR account: Features and benefits

FCNR stands for Foreign Currency Non-Resident account, which allows you to save money earned overseas in foreign currency in India.

If you’re a non-resident Indian (NRI), person of Indian origin (PIO), or an overseas citizen of India (OCI), you may be wondering how to manage your foreign income. A fixed term account with secure and predictable returns could be the answer.

Find out more about NRI services.

What is an FCNR (B) account?

A Foreign Currency Non-Resident Bank, or FCNR (B) account, means your deposit is held in a foreign denomination. This secures it against currency fluctuations. Like a Non-Resident External (NRE) bank account, the funds and the interest earned are tax-free in India.

It works like an FD (fixed deposit) account available to resident Indians, except that with an FCNR account, you deposit only foreign currency. The currencies you're able to deposit include US dollars (USD), pound sterling (GBP), Japanese yen (JPY), Euros (EUR), Canadian dollars (CAD), Australian dollars (AUD), Danish krone (DKK), Swiss francs (CHF), and Swedish krona (SEK).

FCNR accounts are considered a good investment option for NRIs, especially those who live in a country or territory where local banks offer low interest rates.

As a foreign currency term deposit account, it comes with a lock-in period. This means you need to keep your money in the FCNR account for 1-2 years (EUR, JPY, CAD, AUD) or 1-3 years (USD, GBP, DKK, CHF, SEK).

Why should I open an FCNR account?

With an FCNR account, you can:

  • Repatriate the money in your FCNR account, including the principal amount and interest – as it’s in a foreign currency, you can transfer your money to your foreign bank account and vice versa
  • Apply for an overdraft facility against your NRE deposits, meaning you can access funds in an emergency
  • Hold an FCNR deposit jointly with another NRI or Indian resident family member through HSBC – note that a joint account with a resident Indian can be operated only on a ‘Former or Survivor’ basis

What’s the difference between FCNR, NRE and NRO accounts?

NRE account

With a non-resident external (NRE) account, you can deposit any foreign income into an account in India. The foreign currency is converted into rupees at the current exchange rate and can't be held in foreign currency, as with an FCNR account.

NRO account

A non-resident ordinary (NRO) account is a current/savings bank account held in rupees in India. This is best for NRIs still receiving earnings in India, like a pension or rental income. You can still deposit foreign currency into the account, which will be converted to rupees at the current exchange rate.

Compare all NRI accounts and services

Who can open an FCNR account?

Only NRIs/PIOs/OCIs can open an FCNR (B) account. Your NRI status should be as per Foreign Exchange Management Act (FEMA) rules.

What are the requirements for opening an FCNR account?

To place an FCNR deposit, you need to have an NRE account with HSBC India. Once an NRE account is in place, FCNR can be booked at any branch in India or overseas.

You may be asked to provide the following documents:

  • Valid passport
  • Valid visa/work permit
  • Current & permanent address proof
  • PIO status declaration
  • PAN Card
  • For a seafarer’s account, a copy of your passport and CDC, contract letter, declaration letter

Explore: How to open an NRI account online

You can open an FCNR account with:

  • Money transferred in foreign currency through your banking channels
  • A transfer from your NRE account or any other FCNR account
  • A foreign currency cheque drawn in favour of the bank

Learn more about an FCNR deposit account.

If you're opening an FCNR account with HSBC in India, you need to maintain a minimum deposit. This varies according to the currency.

Minimum deposit required for FCNR account
Currency type Minimum deposit amount
Australian dollars AUD1,500
British pounds GBP500
Canadian dollars CAD1,500
Danish krone DKK1,000
Euros EUR750
Japanese yen JPY125,000
Swedish krona SEK1,000
Swiss francs CHF1,000
US dollars USD1,000 
Minimum deposit required for FCNR account
Currency type Australian dollars Australian dollars
Minimum deposit amount AUD1,500 AUD1,500
Currency type British pounds British pounds
Minimum deposit amount GBP500 GBP500
Currency type Canadian dollars Canadian dollars
Minimum deposit amount CAD1,500 CAD1,500
Currency type Danish krone Danish krone
Minimum deposit amount DKK1,000 DKK1,000
Currency type Euros Euros
Minimum deposit amount EUR750 EUR750
Currency type Japanese yen Japanese yen
Minimum deposit amount JPY125,000 JPY125,000
Currency type Swedish krona Swedish krona
Minimum deposit amount SEK1,000 SEK1,000
Currency type Swiss francs Swiss francs
Minimum deposit amount CHF1,000 CHF1,000
Currency type US dollars US dollars
Minimum deposit amount USD1,000  USD1,000 

Are premature withdrawals allowed on the FCNR deposit?

Yes, premature withdrawals are allowed from your FCNR FD. However, no interest is payable if the withdrawal is made before the completion of one year. If premature withdrawal is made after one year, it will be subject to penalties based on interest rate movements and swap cost movements.

Can I use my NRO account to place an FCNR deposit?

No, you cannot use your NRO account for this, according to the applicable regulations in India. However, you can use your NRE account to transfer funds to place an FCNR deposit.

Takeaway

If you're a non-resident Indian, an FCNR account allows you to invest in your home country. You can benefit by parking your overseas earnings in foreign currency without being exposed to the risk of exchange rate fluctuations. And remember, the principal amount and interest are tax-free.

Apply for an FCNR deposit account

Fill out the callback form and we'll phone you back to discuss your application.

Back to top  

Learn more about

You might also be interested in

First-time investor or simply confused about investing? Learn more about the top options available to you in India. 
Do you prefer more certainty in terms of investment returns? NRI deposits might be what you're looking for.
See how the different tax guidelines, exemptions and deductions will affect what you pay as a non-resident Indian.

Disclaimer

This publication has been issued by The Hongkong and Shanghai Banking Corporation Limited (HSBC), India, Incorporated in Hong Kong SAR with limited liability, for the information of its customers only. This publication does not constitute tax or investment advice or an offer to sell, or a solicitation of an offer to purchase or subscribe to any product / investment. The information herein is derived from sources believed to be reliable and the concerned Information Provider(s) have duly authorised HSBC to use such information provided by them. Whilst every care has been taken in compiling the information, HSBC and the concerned Information Provider(s) do not guarantee, or make any representation or warranty and accept no responsibility or liability as to its accuracy or completeness and shall not be liable for damages arising out of any person's reliance upon this information or any action taken or not taken as a result of any material contained in the publication. All information is subject to the relevant Act, Rules, Regulations, Policy Statements, etc., of the Income Tax Department and subject to change. Expressions of opinion are those of HSBC and the Information Provider(s) only and are subject to change without notice. HSBC has not independently verified any information provided by the Information Provider(s) or that has been derived from the sources believed to be reliable by HSBC. Opinions expressed herein do not have regard to specific investment objectives, financial situation and the particular needs of any specific person who may receive this publication. This document is for circulation in India only. No part of this publication may be reproduced or stored in a retrieval system without the prior written permission of HSBC. Any liability is accordingly expressly disclaimed by HSBC, its officers, directors and employees.