What is the eligibility criteria to hold a FCNR account?
With the rupee continuing to remain volatile, the Foreign Currency Non Resident (FCNR) account can be a good option for Non Resident Indians (NRIs) looking to invest in India without worrying about currency risks. Let us look at the key aspects of the FCNR account.What is an FCNR account?An FCNR account is a term deposit account that can be maintained by NRIs and PIOs in foreign currency. Thus, FCNRs are not savings accounts but fixed deposit accounts.What foreign currencies can one maintain in FCNR accounts?Prior to 2011, FCNR deposits were allowed to be maintained in six currencies: US dollar, Pound Sterling (GBP), Euro, Japanese Yen, Australian dollar and Canadian dollar. However, in October 2011, the RBI decided that authorised dealer banks in India may be permitted to accept FCNR deposits in anypermitted currency. 'Permitted currency' for this purpose would mean a foreign currency which is freely convertible and popularly include Danish Krone, Swiss Frank and Swedish Krona among others.