NRO fixed deposits that can be maintained by non-resdient citizens (NRIs) in Indian Rupees are long-term investment options. With a couple of benefits, including higher interest rate, option to repatriate interest on the deposit, overdraft facility and facility to open the term deposit account for either short or long maturity term among others, NRO term deposits yield higher post tax return in comparison to NRO or NRE savings or current account.
Here is a quick comparison of interest rates on NRO term deposits of different public sector, private sector and MNC banks in India:
With effect from November 02, 2013, the private sector lender is offering an interest rate @ 8.25% on NRO term deposit with a maturity term of 91 days to less than 6 months 1 day. While for a deposit with a higher maturity term of3 years 1 day - 5 years, the bank offers 8.75%.
State Bank of India
For a maturity term of 61 days to 179 days, on a deposit of less than Rs. 1 crore, SBI is offering a return of 7.5% while for higher deposits over Rs. 1 crore it offers 7.75%.
For maturity tenure in the range of 2 years and 10 years, for deposits below Rs. 1 crore, bank
w.e.f November 1, 2013 is offering 9% while for higher deposits over Rs. 1 crore offers 8.5%.
3. he bank offers return on NRO deposits at par with domestic term deposits for all maturities. Deposits below Rs. 1 crore for a maturity term of 61-90 days would fetch an investor a return of 7.5% p.a while for the higher deposit amount over Rs. 1 crore with the same maturity, investor will be entitled to a return of 7.75%. On a higher maturity term of 3 years to 10 years, on bulk deposits, investor will gain a return of 8.75%.
Oriental Bank of Commerce
With effect from November 4, 2013, OBC is offering an interest rate @ 8.50% and 8.75% respectively for maturity term of 46-90 days and 3 years to less than 5 years on deposits less than Rs. 1 crore. On bulk deposits of Rs. 1 crore and above, for similar maturity term, OBC offers interest rate @ 8.25% and 8.75% respectively.
Yielding higher post-tax returns in India, NRO term deposits is ceratinly a better bet in comparison to NRO or NRE savings or current account. For deposits below Rs. 1crore, for a shorter maturity term of 90-93 days, an investor can realize a return of 7.50% while for a higher maturity tenure of 732 days to less than 36 months, the bank offers 7.75%.