Loan / Overdraft against NRE / FCNR/NRO Deposits can be availed of up to 85% to 90% of the deposits for purpose other than investments in India subject to the maximum ceiling as per RBI guidelines. The loan cannot be used for the purpose of re-lending, carrying on agriculture/plantation activities or for investment in real estate business. Loans against NRE fixed deposits can however be utilized for investments in India on non-repatriation basis in certain specified areas and for acquisition of flats/houses subject to prescribed conditions.
Loans availed as above cannot be repatriated and as such cannot be credited to NRE/FCNR account. If desired, the loan proceeds can be credited to Non-resident Ordinary (NRO) account.
Repayment of the loan and the payment of interest accrued thereon shall be made either by fresh remittances from abroad or out of maturity proceeds of the borrower’s NRE / FCNR fixed deposits against which the loan was granted or from funds held in NRO accounts. In case of repayment from local rupee resources, interest will be at commercial rate of interest.
Loans can be availed with our correspondents banks abroad (on arrangement) against the NRE / FCNR deposit receipt issued by us.
Loans to residents against the security of NRE / FCNR deposits can be granted subject to prior permission of RBI.
The maximum ceiling of the loan is as per the RBI guidelines.