The Reserve Bank of India (RBI) issued a notification on December 6, 2024, announcing an increase in the interest rate ceilings for Foreign Currency Non-Resident (FCNR) deposits. The new ceiling rates apply to fresh FCNR(B) deposits raised by scheduled commercial banks, small finance banks, regional rural banks, local area banks, and cooperative banks. The revised ceilings for FCNR(B) deposits are as follows: for deposits with a maturity period of 1 year to less than 3 years, the ceiling is Overnight Alternative Reference Rate (ARR) for the respective currency or swap, plus 400 basis points. For deposits with a maturity period of 3 years to 5 years, the ceiling is ARR plus 500 basis points. These changes are effective from December 6, 2024, and are applicable until March 31, 2025.
RESERVE BANK OF INDIA
Interest Rates on Foreign Currency (Non-resident) Accounts (Banks) [FCNR(B)] Deposits
RBI/2024-25/94
DoR.SPE.REC.No.51/13.03.00/2024-2025 Dated: December 06, 2024
All Scheduled Commercial Banks (including Regional Rural Banks)
All Small Finance Banks
All Local Area Banks
All Payments Banks
All Primary (Urban) Co-operative Banks/ DCCBs /State Cooperative Banks
Madam / Sir,
Interest Rates on Foreign Currency (Non-resident) Accounts (Banks) [FCNR(B)] Deposits
Please refer to paragraph 2 of the Statement on Developmental and Regulatory Policies issued as a part of the Bi-monthly Monetary Policy Statement for 2024-25 dated December 06, 2024 read with instructions regarding interest rates on FCNR(B) deposits contained in Section 19 of the Master Direction (MD) on Interest Rate on Deposits dated March 03, 2016 and Section 18 of the Master Direction on Co-operative Banks – Interest Rate on Deposits dated May 12, 2016, as amended from time to time.
2. In terms of clause (g) of the above sections of the MDs, ibid, interest rates on FCNR(B) deposits are subject to ceilings of Overnight Alternative Reference Rate (ARR) for the respective currency/swap, plus 250 basis points for deposits of 1 year to less than 3 years maturity and overnight ARR plus 350 basis points for deposits of 3 years and above and up to 5 years maturity. It has been decided to increase the interest rates ceiling on fresh FCNR(B) deposits raised by the banks with effect from December 06, 2024 as under:
| Period of Deposit | Ceiling Rate |
| 1 year to less than 3 years | Overnight Alternative Reference Rate for the respective currency/ Swap plus 400 basis points |
| 3 years and above upto and including 5 years | Overnight Alternative Reference Rate for the respective currency/ Swap plus 500 basis points |
3. The above relaxation shall be available till March 31, 2025.
Yours faithfully,
(Veena Srivastava)
Chief General Manager
